No. 3472 of the former Income Tax Act (Act No. 3472 of Dec. 31, 1981) does not have any preliminary return or final return on transfer margin, but there is any data to clarify the actual transaction price

According to the purport of each provision of Articles 23(4) and 45(1) of the former Income Tax Act (Act No. 3472, Dec. 31, 1981); and Article 170(3) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 10120, Dec. 31, 1980) where no preliminary return or final return on capital gains has been made, the tax authority may determine capital gains at the standard market price without any investigation by presumption that the actual transaction price is unclear, but if there is any data to reverse such presumption even if there is no such report or report, it shall be based on the actual transaction price if it is evident by the data submitted by the residence or the data investigated by the tax authority, and shall not be based on the standard market price.

Articles 23(4) and 45(1) of the former Income Tax Act (Act No. 3472, Dec. 31, 1981); Articles 170(3) of the former Enforcement Decree of the Income Tax Act (Presidential Decree No. 10120, Dec. 31, 1980);

Supreme Court Decision 83Nu553 Delivered on December 27, 1983

Plaintiff

Head of North Korean Tax Office

Seoul High Court Decision 84Gu97 delivered on January 15, 1985

The appeal is dismissed.

The costs of appeal shall be borne by the plaintiff.

The grounds of appeal are examined.

According to the provisions of Articles 23(4) and 45(1) of the former Income Tax Act (Act No. 3472, Dec. 31, 1981) applicable to this case, the transfer value and acquisition value, which form the basis for calculating gains on transfer, shall be based on the actual transaction value, and in cases prescribed by the Presidential Decree, it shall be based on the market price at the time of acquisition, and pursuant to the provisions of Article 170(3) of the Enforcement Decree of the same Act (Presidential Decree No. 10120, Dec. 31, 1980), where a resident who transfers assets, fails to make a final return on transfer or a final return on transfer, or makes a report differently from the actual transaction value, it shall be based on the market price. According to the purport of the above provision, in a case where there is no preliminary return on transfer or final return on transfer, the tax authority is justified to determine the amount by the standard market price without examining the actual transaction price or to reverse the presumption even without the above report, and thus, it cannot be viewed that the Plaintiff’s tax assessment based on the actual transaction price.

Therefore, the appeal is dismissed, and the costs of the appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating judges.

Justices Jeong Jong-tae (Presiding Justice)