If a seller of real estate purchased by a juristic person refuses to register the transfer of ownership to a juristic person and thereby title trust is made to the representative director of such juristic person, whether it is deemed donated

In the event that a company operating a housing construction business purchases the instant real estate for the purpose of using it as a site for the registration of apartment construction, but the seller refuses to register the ownership transfer to a juristic person, so if the representative director was entrusted to the Plaintiff, and the ownership transfer registration was returned to the name of the juristic person thereafter, it shall not be deemed a gift by applying Article 32-2(1) of the Inheritance Tax Act, even if it is obvious that the title trust was made without the purpose of tax avoidance due to the refusal of the transferor’s cooperation.

Article 32-2(1) of the Inheritance Tax Act

Supreme Court Decision 88Nu5464 delivered on December 22, 1989, 90Nu424 delivered on March 13, 1990, Supreme Court Decision 89Nu4857 delivered on March 13, 1990 (Gong190,909)

[Defendant-Appellee] Kim Jong-won et al., Counsel for defendant-appellee

Head of the tax office

Seoul High Court Decision 89Gu6275 delivered on February 15, 1990

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

We examine the grounds of appeal.

The purport of Article 32-2(1) of the Inheritance Tax Act is to interpret that, in principle, the real owner donated the real estate to the nominal owner on the day when the transfer of the right requires the transfer of the right or the registration of the transfer of the right. However, in cases where it is evident that the real owner and the nominal owner are different from the nominal owner without the purpose of tax avoidance, in light of the circumstances such as refusal of the seller’s cooperation or restriction under the positive law, etc., the gift tax should be imposed by deeming the donation as a donation is an unlawful law several cases of the members of the association (see Supreme Court Decision 88Nu5464 delivered on December 22, 1989; Supreme Court Decision 90Nu424 delivered on March 13, 190; 9Nu4857 delivered on March 13, 199). In this context, the purpose of tax avoidance refers to the purpose of the gift to avoid the gift tax by concealing the gift and, in light of the circumstances under which the title trust was made, it can not be viewed as a gift.

According to the reasoning of the judgment below, the court below acknowledged the fact that, although the non-party corporation, a housing construction business, purchased the real estate of this case for the purpose of using it as the construction site of apartment houses, etc., the seller refused to register the ownership transfer to the corporation, which is the representative director, and that the registration of ownership transfer was returned to the plaintiff, who is the representative director of the corporation, to avoid this, and that the registration of ownership transfer was restored to the name of the corporation. According to the fact-finding of the court below, since it is apparent that the title trust was made without the purpose of tax avoidance due to the refusal of the transferor's cooperation, it cannot be viewed as a gift by applying Article 32-2 (1) of the Inheritance Tax Act because it is apparent that the title trust was made without the purpose of tax avoidance. Whether there is a possibility of tax avoidance against the third party is a different disadvantage under the tax law, it does not interfere with the conclusion that the title trust of this case is a true title trust without the purpose of tax avoidance. The

Therefore, the appeal is dismissed, 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 Lee Chang-chul (Presiding Justice)