Whether the State is liable to compensate for the loss with respect to the taxation that has mistakenly reported the tax investigation.

Where a public official is deemed to have lost objective legitimacy due to his/her failure to perform his/her duty of care, he/she constitutes a tort. In this case, only the reason that he/she did not investigate business registration is that he/she has no responsibility to compensate

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. The defendant shall pay 66,00,000 won with 5% interest per annum from October 31, 2006 to the delivery date of a copy of the complaint of this case, and 20% interest per annum from the next day to the day of complete payment.

1.Basics

(a) Details of land purchase and sale;

(1) On October 19, 2001, the Plaintiff, a representative director, entered into a sales contract with the ○○ Mutual Savings and Finance Company (○○○ Mutual Savings and Finance Company, March 22, 2002; hereinafter referred to as “○○ Bank”), which is the ownership of the ○○ Bank, to purchase the land of KRW 135.69 square meters in Busan ○○○○○ Gun, Busan ○○○○○ 216 Forest and 135.69 square meters in sales amount to KRW 92 million in sales amount.

(2) On April 20, 2002, Hanmaa Bank divided the above forest into 216,00,000 square meters of forest 57,892 square meters (hereinafter “1 piece of land”) and 216-,000 square meters of forest 77,777 square meters (hereinafter “2 land”). On April 30, 200, after preparing a sales contract with the purchase price of KRW 100,000 for the land No. 1, the non-party company will prepare the sales price of KRW 82,00,000 for the land No. 2, and completed each registration for transfer of ownership in the future of the plaintiff.

(3) The Plaintiff completed the registration of ownership transfer on May 25, 2002 with respect to 33058/77/77 of shares in the second land by reason of sale and purchase on May 23, 2002, with respect to 1653/167/7 of shares on May 23, 2002 to Red ○○ on June 3, 2002, with respect to 3306/77 shares for each of the 777/14 May 14, 2002, with respect to 3306 shares on June 3, 2002, with respect to 3307/77 shares for each of the 14/776 shares by reason of sale and purchase on May 14, 2002.

(b) Reporting capital gains tax and refund of global income tax;

(1) On May 25, 2002, the Plaintiff voluntarily paid KRW 91,485,047 of transfer income tax and KRW 9,148,504 of resident tax, upon filing a preliminary return on the tax base of transfer income tax, on the transfer of part of the land to Hong ○○.

(2) On May 31, 2003, the Plaintiff filed a final return on the tax base, including the global income tax for the year 2002, on his wage income and the income from the disposal of the said paragraph (a) and paragraph (2) of the same Article, and received a refund of KRW 21,231,080.

C. Each disposition of this case and revocation thereof

(1) Around September 2005, the head of the Suwon Tax Office conducted a tax investigation with respect to the Plaintiff on the tax evasion report. Accordingly, on January 2, 2006, the head of the Suwon Tax Office deemed the Plaintiff’s income from the disposition of the Plaintiff’s second land as capital gains, and notified the Plaintiff of KRW 61,621,620 as well as KRW 21,469,890 as well as KRW 281,091,572 as to the underreported portion of capital gains tax in 2002 (hereinafter referred to as “the first imposition disposition”). Furthermore, the Plaintiff issued a notice of KRW 21,231,080 as to the underreported portion of capital gains tax (hereinafter referred to as “2nd imposition disposition”). After all, the head of the Suwon Tax Office issued a notice of KRW 312,676,70 as capital gains tax for the year 202 (hereinafter referred to as “201, 2302, 2014”).

(2) On April 3, 2006, the Plaintiff filed a national tax appeal against each of the instant dispositions by proxy certified tax accountants, through ○○. On October 23, 2006, the National Tax Tribunal rendered a decision to revoke the Plaintiff’s income from the disposition of land No. 23 on October 23, 2006 on the ground that the Plaintiff’s income from the disposition of land No. 2 was not capital gains but business

(3) On October 30, 2006, ○○ filed a claim with the Plaintiff for payment of KRW 66 million as remuneration for the pertinent national tax appeal case.

[Ground of recognition] Facts without dispute, Gap 1 through 5, 7, 8, Eul 1, 2, 4 and 5 (including each number), the purport of the whole pleadings

2. The plaintiff's assertion and judgment

A. The plaintiff's assertion

The Plaintiff had already registered the business of land trading business prior to the disposal of land No. 2, and had received a partial refund of the amount voluntarily paid as capital gains tax through the final return on tax base, such as global income tax, but the public officials belonging to Suwon Tax Department did not investigate the Plaintiff’s business registration and the refund of capital gains tax in the course of tax investigation with respect to the Plaintiff, and accordingly, each of the dispositions

However, since it is customary to recognize the transfer of land by a person who registered his/her business for land trade business, it constitutes a serious negligence to impose each of the instant dispositions without investigating such issues at the tax office. The Plaintiff suffered losses in order to revoke each of the above dispositions, and thus, the Defendant is liable to compensate the Plaintiff for the said losses.

B. Determination on the assertion

(1) Facts of recognition

In light of the facts without dispute, Gap evidence 3, Gap evidence 4, Gap evidence 10, Eul evidence 7, and Eul evidence 7, the purport of the whole pleadings is as follows: ① The plaintiff completed the registration of business with the trade name "○○ Development on April 29, 2002", which was prior to the day when the registration of ownership transfer for the second land was completed; ② the number of ○○ and Kim Jong-tae reported the results of the tax investigation on the plaintiff around November 2005; ② the report of the investigation on the plaintiff was prepared; ② the non-party company's business registration number and the type of business were not stated in the respondent column; ③ the non-party company's business registration number and the type of business were not stated in the non-party company's business registration number and the income of the plaintiff from the second disposition, or the plaintiff's income from the second disposition constitutes business income, ③ the fact that the plaintiff was paid part of the tax return and the amount of the tax return on global income before the second disposition of transfer income tax was made to the plaintiff's.

(2) Determination

(A) In light of the above facts of recognition, the head of the Suwon District Tax Office deems that the Plaintiff was paid part of the amount paid voluntarily as capital gains tax through the final return on tax base, including the fact that the Plaintiff was registered as a land trade business and the global income tax, and that the Plaintiff was subject to the primary

(B) However, whether the income from the transfer of real estate is business income or capital gains under the Income Tax Act shall be determined according to ordinary social norms, considering the transferor’s acquisition and holding status of real estate, creation, size and frequency of transfer, mode, other party, etc. of real estate for the purpose of profit-making, and the continuity and repetition of business activities to the extent that it can be seen as business activities. The determination shall take into account not only the transfer of real estate, but also the overall real estate owned by the transferor, and all the circumstances surrounding the transfer of real estate before and after the time when the transfer took place (see Supreme Court Decision 94Nu16021, Sept. 15, 195). It is nothing more than one reference material in determining whether the transfer of real estate is registered as a real estate purchaser or transfer income (see, e.g., Supreme Court Decision 86Nu138, Apr. 14, 1987). In other words, in light of the evidence and facts seen below, the non-party company did not change its utility value as part of the land before the Plaintiff’s sale and sale of real estate.

In addition, the head of the Suwon Tax Office, after considering the fact that the plaintiff received the refund of KRW 21,231,080 through the final return on the tax base including global income tax for the year 2002, even after having known that the plaintiff had been registered as the business operator of the land sale business on February 1, 2006, the head of the Suwon Tax Office imposed the secondary tax disposition on the additional revised portion of capital gains tax for the year 2002 on March 17, 2006. However, although the head of the Suwon Tax Office could cancel the first tax disposition ex officio prior to the second tax disposition, even if the plaintiff had already received the tax return after the registration of the business operator as the land sale business, the income of the plaintiff's second tax disposition is not the business income, but the income of the second tax disposition.

(C) On the other hand, in a case where a public official in charge of a certain administrative disposition is deemed to have lost objective legitimacy by failing to perform an objective duty of care when considering the general public official’s standard, such administrative disposition constitutes a tort due to the public official’s intentional or negligent act. In such a case, whether it has lost objective legitimacy ought to be determined by whether a substantial reason for imposing liability for compensating for damages on the State or local governments exists, by comprehensively taking into account all the circumstances, such as the type and nature of gains of infringement, the form and cause of an administrative disposition infringing on, and the victim’s involvement in the exercise of the administrative disposition, the degree of involvement in the exercise of the administrative disposition, and the degree of damage (see, e.g., Supreme Court Decision 2001Da33789, 33796, 33802, 33819, Nov. 27,

Considering the above circumstances in light of the above legal principles, inasmuch as the Defendant rendered the second imposition disposition based on the Plaintiff’s second disposition of capital gains even after having become aware of the Plaintiff’s business registration and tax refund, it is insufficient to deem that there was a substantial reason for the State to bear the responsibility of compensating for damages equivalent to the Plaintiff’s tax accountant’s remuneration due to a national tax appeal, on the sole basis of the fact that the Defendant did not investigate the Plaintiff’s business registration and global income tax refund prior to the first imposition, and there is no other evidence to acknowledge otherwise, it cannot be deemed that the Defendant’s series of acts committed by the public officials belonging to

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just and it is dismissed as it is without merit. It is so decided as per Disposition.