Early High Court Decision 2009Du4135 (Ob. 24, 2010)

Any disposition that is imposed by denying the reduction or exemption of capital gains tax by deeming that it has not been cultivated directly for at least eight years is legitimate.

Even after the donation of land, it is reasonable to view that the third party cultivated the land after his father and the third party cultivated the land, and that the plaintiff made a simple cultivation for at least eight years. Therefore, it is insufficient to recognize that the plaintiff directly cultivated the land for at least eight years.

2010Guhap7056 Revocation of Disposition of Imposing capital gains tax

Doz.

O Head of tax office

December 16, 2010

January 6, 2011

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The Defendant’s disposition of imposition of capital gains tax of KRW 66,344,110 against the Plaintiff on July 14, 2009 is revoked (it appears that July 13, 2009 of the complaint appears to be a clerical error in writing on July 14, 2009).

1. Details of the disposition;

A. On April 17, 1998, the Plaintiff acquired land from his father, which was donated to GGB, 581-4 2,777 square meters (hereinafter “instant land”) prior to CC 581-4, and transferred the instant land to the Defendant on September 4, 2008, and thereafter made a preliminary return of capital gains tax on the income accrued from the transfer of the instant land by deeming that it was farmland with a self-sufficient land for at least eight years, and that it was exempted from tax pursuant to Article 69 of the Restriction of Special Taxation Act (amended by Act No. 9924, Jan. 1, 2010).

B. On July 14, 2009, the Defendant: (a) deemed that the Plaintiff did not own the instant land for at least eight (8) years; and (b) rendered the instant disposition imposing KRW 66,344,110 on the Plaintiff on July 14, 2009.

C. The Plaintiff filed an objection with the Tax Tribunal on November 26, 2009, seeking the revocation of the instant disposition, but was dismissed on February 24, 2010.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, Eul evidence 1, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff directly cultivated the instant land for at least eight years after its acquisition, and transferred the same.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) "Direct cultivation" under Article 69 (1) of the Restriction of Special Taxation Act and "self cultivation" under Article 104-3 (1) 1 (a) of the Income Tax Act mean that a resident is engaged in cultivating crops or growing perennial plants on his own land or growing or growing them with his own labor (Article 66 (13) of the Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 21307 of Feb. 4, 2009) as a unified concept for the purpose of achieving the legislative purpose of promoting agriculture and rural communities by preventing external farmland speculation and reducing the tax burden of self-employed farmers for not less than 8 years by reducing the tax burden of self-employed farmers. Therefore, "direct cultivation" means that a resident is engaged in cultivating or growing them with his own labor if he cultivates them or cultivates them with more than 1/2 of their own labor even if there is another occupation.

(2) On the premise of such a legal doctrine, the following facts can be acknowledged according to each of the statements in the Evidence Nos. 3 through 5 (including each of the natural disasters) in the Health Unit A.

① The neighboring residents of the instant land prepared a letter of confirmation to the effect that the Plaintiff cultivated the instant land directly from around 1998 to the time of the transfer of the instant land. ② Nonparty Doz, who operated Nonparty Doctrine, issued a letter of confirmation to the effect that Nonparty Doctrine had sold agricultural chemicals and farming materials to the Plaintiff from around April 1998 to October 2008. ③ Nonparty YE created a letter of confirmation to the effect that the Plaintiff cultivated the instant land along with his father and Nonparty 2, who had cultivated the said land even after marriage.

(3) However, according to the purport of Gap evidence Nos. 2, 5-1, Eul evidence Nos. 2 through 4 and the whole pleadings, the following facts can be acknowledged.

① The instant land is adjacent to the CC 232-7 4,973 square meters, GGB, which is the Plaintiff’s eF-owned farmland, and the boundary of two lots is unclear, and is now cultivated by Mana and sublime. ② According to the FF’s statement, his father directly cultivated the instant land before he died on January 11, 2001, and the Plaintiff, after marriage, was working for the agricultural cooperative after moving to the apartment located in GG city, and tried to work for the agricultural cooperative twice in one month. ③ The Mana-Guarantee Co., Ltd. (No. 5-1 of the evidence No. 5), prepared by the EE, entered that the Plaintiff cultivated the instant land from the instant land on a monthly to three occasions after marriage. ④ According to the results of the on-site investigation conducted by public officials affiliated with the Defendant, the Plaintiff’s co-owned land on behalf of the transferee of the instant land, and the Plaintiff’s co-owned land on a non-owned land 9-37, 2008 square meters.

According to the above facts, it is reasonable to view that, even after the Plaintiff’s father and Lee F were donated the land of this case by his father and his father were cultivated and his father died, this FF cultivated the land, and the Plaintiff was simply engaged in simplified cultivation. Therefore, it is insufficient to recognize that the Plaintiff was directly cultivated the land of this case for not less than eight years (in addition, the evidence constituting the basis for fact-finding under the above paragraph is insufficient since it can be prepared voluntarily, and therefore its credibility is insufficient).

(3) Ultimately, the Plaintiff’s assertion is without merit.

3. Conclusion

Thus, the plaintiff's claim of this case is dismissed as it is without merit.