Whether a decision to reject an application for refund of capital gains tax in cases of transfer of a building site is an administrative disposition subject to appeal litigation (negative)

The right to claim the transfer income tax when transferring a building site at the time of enforcement of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865 of Dec. 26, 1986) is finalized pursuant to Article 63(1) of the same Act. The provisions of the Framework Act on National Taxes do not only provide for the internal procedures of the tax authorities for the national tax refund and additional dues determined by the individual tax law, but also do not confirm the right to claim the refund only by the national tax refund decision under the same provision. Thus, the decision to refuse the refund of the above national tax refund decision or the request for this decision is not a disposition which directly and directly affects the existence or scope of the right to claim the refund, and the refusal of the refund is merely a mere refusal of the performance of a monetary obligation.

Article 63(1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 3865, Dec. 26, 1986); Articles 51 and 52 of the Framework Act on National Taxes; Article 30 of the Enforcement Decree of the Framework Act on National Taxes; Article 2 of the Administrative Litigation Act

Supreme Court Decision 85Nu883 Decided January 31, 1989, 88Nu6436 Decided June 15, 1989, 88Nu1605 Decided February 13, 1990, 89Nu4932 Decided April 27, 1990

Seoul High Court Decision 200Na1484 decided May 1, 200

The Head of the Maternization Tax Office

Seoul High Court Decision 88Gu13276 delivered on April 14, 1989

The judgment of the court below is reversed.

The plaintiff's lawsuit is dismissed.

All costs of the lawsuit shall be borne by the plaintiff.

We examine the plaintiff's merits of the lawsuit of this case ex officio.

The Plaintiff’s cause of the instant claim is that the Plaintiff transferred the land owned to the YY-gu Committee of the Republic of Korea, a non-party incorporated, and paid the income tax on the said transfer. Since the corporation constructed the land on that land within three years from the date of the transfer, the Plaintiff applied for a refund of the amount equivalent to 50/100 of the capital gains tax of this case by applying the capital gains tax reduction and exemption provisions on the land for construction as stipulated in Article 63(1) of the former Regulation of Tax Reduction and Exemption Act (rec. 3865, Dec. 26, 1986). However, since the Plaintiff received the balance of the land transfer price on April 6, 1987, the time of the transfer shall be deemed the time of the transfer of the said land. Accordingly, the time of the transfer of the said land shall be deemed to be the time of the transfer of the said land under Article 10(3) of the Addenda of the above amended Act, and thus, the said disposition of refusal to refund should be revoked.

Article 63(1) of the former Regulation of Tax Reduction and Exemption Act provides that where a national transfers land to a building site as prescribed by the Presidential Decree, and a person who acquires the land constructs the building within the time limit prescribed by the Presidential Decree, the amount equivalent to 50/100 of the transfer income tax or special surtax on income accruing from the transfer of the land shall be refunded to the transferor. Furthermore, Articles 51(1) and 52 of the Framework Act on National Taxes and Article 30 of the Enforcement Decree of the same Act provide that where a taxpayer has a refund tax out of the amount paid as a national tax, additional dues or disposition fee for arrears, the head of a tax office shall immediately determine the refund of national tax, and at the same time, the refund counter of transfer income tax at the time of transfer of a building site shall be added at the time when the refund of national tax is appropriated or refunded. In full view of the above provisions, the provisions of the Framework Act on National Taxes do not stipulate the internal procedures of the tax authority with respect to the national tax refund and additional dues established by the declaration of individual tax laws, and they shall not be subject to the refund decision of 981.

Thus, the defendant's refusal to refund the transfer income tax of this case is not a disposition which is not a subject of appeal, and thus the plaintiff's lawsuit of this case seeking its revocation should be dismissed, but the court below accepted the plaintiff's claim. The court below erred by misapprehending the legal principles on refund of the transfer income tax under Article 61 (1) of the former Regulation of Tax Reduction and Exemption Act, which affected the conclusion of the judgment. Thus, the judgment of the court below is reversed to dismiss the plaintiff's lawsuit, and the total costs of lawsuit are assessed against the losing party.

Justices Kim Yong-sung (Presiding Justice)