The method of calculating gains on transfer where either of the transfer values and acquisition values under the former Corporate Tax Act (amended by Act No. 3270, Dec. 13, 1980) is unclear;

In applying the proviso of Article 59-2 (3) of the former Corporate Tax Act (amended by Act No. 3270 of Dec. 13, 1980), the transfer value and acquisition value are not clear, as well as where only one of the two values is unclear, all of the above two values shall be calculated based on the standard market price, and the value of the other unclear part shall be calculated on the basis of the standard market price, and the other value shall be calculated on the basis of the standard market price and it shall not

Article 59-2 (3) of the former Corporate Tax Act (amended by Act No. 3270 of Dec. 13, 1980)

Supreme Court Decision 82Nu557 Delivered on April 26, 1983

Attorney Park Young-soo, Counsel for the defendant-appellant of the Korea Foundation

The Director of the Korean Tax Office

Seoul High Court Decision 84Gu1192 delivered on November 5, 1985

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

According to Article 59-2(3) of the Corporate Tax Act (amended by Act No. 3270, Dec. 13, 1980) which was in force at the time of the instant case, gains on transfer, which are the tax base of special surtax, shall be the amount obtained by deducting the acquisition value and expenses prescribed by the Presidential Decree, from the transfer value, and where the transfer value and the acquisition value are unclear, the transfer value and the amount based on the standard market price prescribed by the Presidential Decree shall be the transfer value and the acquisition value respectively. In applying this provision, not only where the transfer value and the acquisition value are unclear but also where only one of the two values is unclear, the above two values shall be calculated on the basis of the standard market price, and the other unclear value shall be calculated on the basis of the standard market price and the calculation on the basis of the actual transaction price shall not be permitted in equity (see Supreme Court Decision 82Nu

In the same purport, the court below's disposition that calculated the tax base of special surtax based on the statutory standard price under the Local Tax Act is just, and there is no error of law such as misunderstanding of legal principles or lack of reasoning. We cannot accept the judgment of the court below in its independent opinion.

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

Justices Choi Jae-ho (Presiding Justice)