[1] The case holding that real estate transfer by land expropriation, etc. is part of real estate sale business

[2] Whether the global income tax on the transfer of land for public project constitutes the reduction or exemption under Article 57 (1) of the former Tax Reduction and Exemption Control Act (negative)

[3] Whether the details and disposition of global income in the absence or revocation of a capital gains tax imposition disposition constitutes a double taxation disposition (negative)

[4] Whether Article 142 (1) and (2) of the former Enforcement Decree of the Income Tax Act is invalid because there is no ground for delegation under this Act (negative)

[1] The case holding that if the real estate and 16 lots of land owned by each of the above real estate and other land owned by the previous from September 27, 198 to November 21, 1990 were sold in whole throughout the country after purchasing 17 lots of land and 3 lots of buildings during the period from January 6, 198 to June 12, 198, and the real estate market had been high nationwide, it can be deemed that the real estate sales business was operated by purchasing and transferring the land with continuous profit-making purpose after 198, and even if part of the land previously owned was expropriated through consultation during the real estate sales business, barring any special circumstance, it shall be deemed that the land was already transferred as part of the real estate sales business, and income therefrom shall also constitute income generated from the real estate sales business.

[2] The tax reduction and exemption provisions for the transfer of land for public project under Article 57 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4285 of Dec. 31, 1990) are only subject to capital gains tax or special surtax. Thus, unless otherwise specifically provided, the above reduction and exemption provisions may not be extended or analogically applied to cases where global income tax is imposed on the transfer of land.

[3] Even if a taxpayer reported and paid a transfer income tax for the transfer of real estate, it cannot be deemed that the tax authority imposed a transfer income tax. In addition, if a tax authority finds any error found that the tax authority recognized the income from real estate transactions as transfer income and recognized it as a transfer income tax, it may ex officio cancel the transfer income tax imposition disposition and impose a comprehensive income tax by recognizing it as a business income. Thus, if a transfer income tax imposition disposition did not have existed or was revoked from the beginning, it cannot be deemed unlawful as it constitutes duplicate disposition or double taxation.

[4] Where the Government determines profit margins or tax amount pursuant to Article 94(1) of the former Income Tax Act (amended by Act No. 4281 of Dec. 31, 1990), the tax base and tax amount of global income tax shall be determined by the actual amount revealed by the method of a field investigation. Thus, Article 142(1)1 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 13194 of Dec. 31, 190) only provides a natural matter derived from the interpretation of the provisions of Article 94 of the Act itself, and it does not provide for matters concerning taxation requirements or procedures. Since Article 142(1)2 and the former part of Article 142(2) of the Enforcement Decree of the Income Tax Act (amended by Act No. 4281 of Dec. 31, 1990), the latter part of Article 142(1) and Article 142(2)2 of the Enforcement Decree of the Act provides the basis for calculating profit margins on delegation of the Act cannot be deemed as necessary for the latter part of the Act.

[1] Article 20 (1) 8 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994; see Article 19 (1) 12 of the current Income Tax Act); Article 36 subparagraph 3 of the former Income Tax Act (amended by Presidential Decree No. 14467 of Dec. 31, 1994; see Article 34 of the current Act) / [2] Article 57 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4285 of Dec. 31, 1990; see Article 63 (1) of the current Act) / [3] Article 51 of the Framework Act on National Taxes; Article 20 (1) 8 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994; see Article 19 (1) 14 of the current Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 48194 of Dec. 139, 194, 19694)

[1] [3] Supreme Court Decision 94Nu14025 delivered on November 7, 1995 (Gong1995Ha, 3939) / [1] Supreme Court Decision 94Nu16021 delivered on September 15, 1995 (Gong1995Ha, 344) / [2] Supreme Court Decision 95Nu92 delivered on November 7, 1995 (Gong1995Ha, 3941) / [3] Supreme Court Decision 86Nu312 delivered on November 11, 1986 (Gong1987, 38), Supreme Court Decision 87Nu642 delivered on April 13, 199 (Gong190, 1086) / [2] Supreme Court Decision 97Nu297979 delivered on April 16, 197

Plaintiff (Attorney Kim Jong-man, Counsel for plaintiff-appellant)

The Head of the Maternization Tax Office

Seoul High Court Decision 93Gu29824 delivered on June 7, 1995

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

We examine the grounds of appeal.

On the first ground for appeal

Whether the income from the transfer of a certain real estate belongs to the business income under the Income Tax Act or is subject to the transfer income tax, shall be determined according to the ordinary social norms, considering the transferor's acquisition and holding of real estate, whether the transfer was made, the scale and frequency of the transfer, how the transfer was made, and whether the transfer was made for the purpose of profit and whether the transfer was made continuously and repeatedly as business activities (see, e.g., Supreme Court Decisions 85Nu458, Dec. 24, 1985; 95Nu92, Nov. 7, 1995; 95Nu92, Nov. 7, 1995; 200; 3). In making such a judgment, not only the transfer of real estate for the purpose of the transfer, but also all the circumstances before and after the transfer of real estate held by the transferor should be taken into account (see, e.g., Supreme Court Decision 94Nu14025, Nov. 7, 1995).

According to the reasoning of the judgment below and the record, the Plaintiff purchased 17 lots of land and 4,316.16 square meters in Seoul and Gyeonggi-do and 109.21 square meters in total as shown in the judgment of the court below during the period from January 6, 1988 to June 12, 1989, the Plaintiff purchased 17 lots of land and 4,316.16 square meters in Seoul and 109.21 square meters in total and 109.21 square meters in a 16th place in a 16th place in a 4th place in a 16th place in a 16th place in a 4th place in a 16th place in a 195th place in a 16th place in a 16th place in a 3th place in a 16th place in a 3th place in a 197th place in a 4th place in a 197th place in a 197th place in a 206th in a 197th place in a 197.8.

In light of the above circumstances, the Plaintiff may be deemed to operate real estate sales business by purchasing and transferring land with continuity for profit after 1988, and even if part of the land previously owned was expropriated during the period of real estate sales business, barring any special circumstance, the said land shall be deemed to have been transferred as part of the Plaintiff’s business that commenced real estate sales business, barring any special circumstance. Accordingly, income accrued therefrom shall be deemed to fall under the income accrued from real estate sales business.

The judgment below to the same purport is just, and there is no violation of the legal principles as to real estate sales business as otherwise alleged in the ground of appeal.

On the second ground for appeal

The provisions on the requirements for non-taxation or tax reduction and exemption have resulted in a result contrary to the principle of tax equity if extended interpretation thereof leads to a strict interpretation as well as the provisions on the requirements for taxation (see, e.g., Supreme Court Decision 89Nu7191, May 2, 1990). The provisions on the transfer of land for public business under Article 57 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4285, Dec. 31, 1990) are limited to transfer income tax or special surtax, so the above reduction and exemption provisions may not be extended or analogically applied to the case where global income tax is imposed on the transfer of the above land (see, e.g., Supreme Court Decision 95Nu92, Nov. 7, 1995). Thus, if the Enforcement Decree of the Income Tax Act (Presidential Decree No. 14083, Dec. 31, 1993) newly established and implemented after the transaction of each of the above real property, it should be interpreted without the above provisions.

The judgment below to the same purport is just, and there is no error in the misapprehension of legal principles as otherwise alleged in the ground of appeal.

On the third ground for appeal

Even if a taxpayer reported and paid a transfer income tax on the transfer of real estate, it cannot be deemed that the tax authority imposed a transfer income tax. In addition, if the tax authority finds any error found that the taxpayer recognized the transfer income from a real estate transaction as a transfer income and thereby recognized the transfer income tax as a transfer income tax, it may cancel the transfer income tax imposition ex officio and impose a comprehensive income tax by recognizing it as a business income (see Supreme Court Decision 94Nu14025 delivered on November 7, 1995). Thus, if a transfer income tax imposition disposition was never made or revoked, it cannot be deemed that the global income tax and the detailed disposition made after such disposition constitute double disposition or double taxation (see Supreme Court Decision 86Nu312 delivered on November 11, 1986).

원심판결 이유 및 기록에 의하면, 피고는 원심 판시 1988년도와 1989년도 각 양도분 및 1990년 양도분 중 (주소 4 생략) 대 31.8㎡의 양도에 대하여는 모두 양도소득세부과처분을 하였으나, 1990년 양도분 중 원심 판시 별지 ㉯ 내지 ㉳ 부동산의 양도에 대하여는 원고가 자산양도차익예정신고 및 자진납부를 하였을 뿐 피고가 양도소득세부과처분을 하였음을 인정할 수 있는 자료가 보이지 아니하며, 피고는 1992. 12. 16. 이 사건 각 부동산의 양도가 부동산매매업에 해당한다 하여 위 양도소득세부과처분을 모두 취소하고, 1988년도 내지 1990년도 귀속분 종합소득세의 각 과세표준에 의한 총결정세액에서 양도소득세 자진납부세액과 환급가산금 합계액을 기납부세액으로 공제한 금액으로 각 귀속분 종합소득세 및 방위세를 부과·고지하였음을 알 수 있다.

The reasoning of the court below's decision that the transfer income tax imposition disposition on each real estate of this case was not imposed or revoked from the beginning, and it cannot be deemed unlawful as it constitutes double taxation or double taxation. Thus, although the reasoning of the court below's decision that the global income tax and the transfer income tax constitute a separate tax item is somewhat insufficient, the conclusion of the court below's decision that each of the global income tax of this case does not constitute double taxation is justifiable, and therefore, the ground of appeal cannot be accepted.

On the fourth ground

Article 142(1) of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 13194, Dec. 31, 190; hereinafter the same shall apply) provides that "the determination of profit margin and amount of tax on land, etc. under the provisions of Article 94 of the Act shall be made as follows;" subparagraph 1 provides that "where profit margin can be calculated on land, etc. under the provisions of Article 141 based on evidential documents or documentary evidence submitted by a real estate broker at the time of provisional return on sale of land, books and documentary evidence, it shall be investigated and determined by such method; where falling under any subparagraph of Article 169(1)2, the profit margin on land, etc. shall be calculated by multiplying the sales price by the income standard rate, and where it can be confirmed through the method of tax investigation under Article 149(1)2 of the Enforcement Decree of the Income Tax Act, it shall not be deemed that the actual transaction price can be determined separately by the provisions of Article 149(1)2 of the former Enforcement Decree.

Meanwhile, the latter part of Article 142(2) of the Enforcement Decree provides for the method of estimating profit margin when the real transfer value cannot be confirmed, and the above provision provides for specific delegation of law as it constitutes a new requirement for taxation. Article 92(4) of the Act (Article 92(3) prior to the amendment of December 26, 198) provides for necessary matters concerning the calculation of profit margin and provides legal basis for the calculation of profit margin. Thus, the latter part of Article 142(2) of the Enforcement Decree cannot be deemed null and void as there is no delegation of law.

The judgment below to the same purport is just, and there is no violation of the principle of no taxation without law as otherwise alleged in the ground of appeal.

Therefore, the appeal is dismissed as it is without merit, and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Final Young-young (Presiding Justice)