1. The defendant's appeal is dismissed.

2. The costs of appeal shall be borne by the Defendant.

Purport of claim and appeal

1...

1. Details of the disposition;

A. From December 8, 2011, the Plaintiff acquired a factory building of 2,500 square meters of land for C and of 1,228.87 square meters of land in Kimhae-si (hereinafter referred to as “instant real estate” together with the aforementioned factory site and factory building; and the said factory building is referred to as “instant building”; and was exempted from acquisition tax by the Defendant pursuant to the main sentence of Article 120(3) of the former Restriction of Special Taxation Act (amended by Act No. 11133, Dec. 31, 2011; hereinafter the same) from a small or medium start-up enterprise pursuant to the main sentence of Article 120(3) of the same Act.

B. On September 12, 2013, based on the audit results conducted by the Board of Audit and Inspection, the Defendant: (a) deemed that the Plaintiff leased all of the instant building and its appurtenant land to B for other purposes without justifiable grounds; (b) issued a disposition imposing acquisition tax of KRW 33,903,660, special rural development tax of KRW 1,695,160, local education tax of KRW 3,140,650, and local education tax of KRW 3,650 (hereinafter “instant disposition”).

C. On June 20, 2013, the Plaintiff appealed and filed a pre-assessment review with the Gyeongnam-do. However, the Gyeongnam-do rejected the Plaintiff’s claim on September 4, 2013, and the Plaintiff filed an appeal with the Tax Tribunal for the revocation of the instant disposition on November 5, 2013, but the Tax Tribunal rendered a decision to dismiss the Plaintiff’s appeal on September 23, 2014.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, Eul evidence 1 to 4, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. Whether the Plaintiff constitutes a small or medium start-up start-up enterprise under Articles 6 and 120 of the former Restriction of Special Taxation Act, the Defendant, if the Plaintiff’s start-up business takes over the business in B or acquires or purchases the assets used for the business in B, and operates the same kind of business, ii) the Plaintiff’s in-house director F is a corporation.