Incheon District Court-2013-Gu Partnership-523 (O16, 2014)

Any disposition that is imposed on a real estate or non-business land not directly related to the business of a corporation is legitimate.

Considering the circumstances cited by the Plaintiff and the materials submitted by the Plaintiff, the disposition imposing corporate tax is legitimate on deeming the real estate not directly related to the business as it is difficult to view that the use of the land for business purposes is prohibited or restricted by the corporate tax-related provisions after acquiring the land under the corporate tax-related provisions, or because it is difficult to

Article 27 (Non-Inclusion of Expenses not Related to Business in Deductible Expenses)

Seoul High Court 2014Nu42560 Revocation of Disposition of Corporate Tax Imposition

○ Industrial Development Corporation

OO Head of the tax office

November 21, 2014

December 05, 2014

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. On November 10, 201, the defendant revoked the disposition of imposition of the corporate tax of 2008 to the plaintiff, the corporate tax of 2009, the corporate tax of 2009, the corporate tax of 2010, the corporate tax of 2010, and the corporate tax of 00 won for 2010.

1. Quotation of the reasons for the judgment of the first instance;

This judgment is based on Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act, except for the following matters, among the reasons for the judgment of the court of first instance, and it is based on the main sentence of Article 420 of the Civil Procedure Act.

(1) On face 3, the following shall be added to Chapter 8:

(1) Article 49 (1) 1 (proviso) of the Enforcement Decree of the Corporate Tax Act provides that the grace period shall be five years from the date of acquisition, but if there are inevitable reasons under the proviso of subparagraph 1 above, the progress of the grace period shall be deemed to have been suspended. This provision provides that the above subparagraph 1 excludes real estate not related to business if there are unavoidable reasons, and that Article 83-5 (1) 12 of the Enforcement Rule of the Income Tax Act provides that the land which is not used for business due to justifiable reasons does not fall under the non-business land during the period in which such reason arises, and this provision may also be applied by analogy in this case. Accordingly, the grace period of five years from the date of acquisition in this case shall continue from January 31, 202 to February 4, 2005 (3 years and 4 days), and it shall be deemed that the subsequent suspension period has been terminated from October 2, 2008 to September 29 (20, 2010).

(3) On face 3, the following shall be added to Chapter 18:

c. Determination as to the allegation of suspension of a grace period

According to Articles 27 and 28 of the Corporate Tax Act, Article 49 (1) 1 (a) of the Enforcement Decree of the Corporate Tax Act, and Article 26 (1) 1 of the former Enforcement Rule of the Corporate Tax Act, and Article 26 (5) 29 of the former Enforcement Rule of the Corporate Tax Act, where the relevant real estate is acquired and it is not used for business due to justifiable reasons such as changes in urban planning, it shall be excluded from assets for non-business use. In the case of land for new construction, the grace period of five years from the date of acquisition shall be set to exclude from the assets for non-business use.

However, even according to the above provision, there is no ground to interpret that the period of the grace period 5 years from the date of acquisition shall be interrupted as in the Plaintiff’s assertion. Moreover, Article 83-5(1)12 of the Enforcement Rule of the Income Tax Act only stipulates that the land used for a business for justifiable reason does not constitute a non-business land during the period in which the pertinent reason arises, and therefore, it is difficult to view that the progress of the grace period 1 years for the period in which there exists a justifiable reason by analogical application of this case like the Plaintiff’s assertion is suspended.

Therefore, the grace period shall be deemed to expire five years after the date of acquiring the relevant real estate, and with respect to the land which is not used directly for business without any justifiable reason after the grace period expires, it is reasonable to exclude the interest paid from deductible expenses pursuant to Articles 27 and 28 of the Corporate Tax Act. The plaintiff's assertion that differs from this premise

(4) On the 3rd side, the 19th side judgment is "D. Judgment on justifiable grounds".

(5) On the 6th page 19, "request for consultation" shall be made for consultation.

(6) On the 14th page, the following shall be added:

2. Conclusion

Therefore, the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.