The case holding that appraisal value based on the "securities analysis standards" cannot be deemed as the market price under Article 5 (1) of the Enforcement Decree of the Inheritance Tax Act.

The "standards for securities analysis" in the appraisal of stocks is based on the provisions on the securities acquisition business, and these provisions set the criteria necessary for securities companies to conduct the underwriting business of securities, and therefore, they are mainly regulations on the appraisal of stocks at the time of the public offering of the company or the increase of stocks of listed companies, and accordingly, the appraisal of the value of stocks is based on the interests of the underwriters or investors, so there is a tendency to be evaluated lower than the market price, and it cannot be deemed as the market price at the price evaluated in an objective and reasonable manner as referred to in

Article 9(1) of the former Inheritance Tax Act (amended by Act No. 4283 of Dec. 31, 1990); Articles 5(1) and 5(5)1(b) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 13196 of Dec. 31, 1990)

[Judgment of the court below]

The Head of the Maternization Tax Office

Seoul High Court Decision 91Gu29523 delivered on June 24, 1993

The judgment below is reversed and the case is remanded to Seoul High Court.

We examine the Defendant’s grounds of appeal.

According to the reasoning of the judgment below, since the plaintiff received 3,120 shares (hereinafter "the shares of this case") from the non-party 1, his father on October 30, 1989 from the non-party 1, the non-party 3 corporation of the above non-party 4 corporation, the market price of the non-party 1 corporation, and the 3,120 shares (hereinafter "the non-party 3 corporation"), the defendant calculated the market price of the shares of this case by the supplementary valuation method under Article 5 (5) 1 (b) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 13196 of Dec. 31, 190) and assessed the value of the shares of this case based on the market price of the non-party 4 corporation's shares at an objective and reasonable market price of the non-party 1 corporation's 9,300 shares in consideration of the market price of the above non-party 1 corporation's shares, which is the non-party 1 corporation's total value of shares.

Article 9(1) of the former Inheritance Tax Act and Article 5(1) of the Enforcement Decree of the same Act mean, in principle, an objective exchange price formed through free and normal transactions between many and unspecified persons. However, since the concept includes the value appraised in an objective and reasonable manner, it is reasonable to determine that even if the value of the objective exchange is unlisted stocks, if there is a reliable appraisal institution’s appraisal value that properly reflects such objective exchange value, it may be deemed the market price

However, according to the records, since the court below's appraisal of new securities company, which is a reliable appraisal institution's appraisal value reflecting the objective exchange value of the stocks of this case, is based on the standards for securities analysis, these standards are mainly determined by securities companies to take over securities and thus, the appraisal value of the stocks of the public offering company or the company's capital increase is likely to be lower than the market price since it takes into account not only the provisions for stock appraisal at the time of the public offering or the company's capital increase, but also the interests of the purchaser or investors (it can be known that there are considerable differences between the issuance price of other stocks listed in the evidence 9 through 14 above - the appraisal value - the appraisal value based on the above standards - the appraisal value based on the appraisal value of the stocks of this case can be seen as the market price based on the objective and reasonable method as stated in the Inheritance Tax Act, and even if it is based on the standards for securities analysis, it is difficult to reflect the above appraisal value of the company's new appraisal value as the market price of the same business year.

Therefore, as long as the market price cannot be seen as the market price that reflects the objective exchange value of the stock in this case, the price of the stock in this case is difficult to calculate the market price so long as the market price cannot be seen as the market price which reflects the objective exchange value of the stock in this case, the price of the stock in this case shall be calculated according to the supplementary evaluation method under Article 5 subparagraph 1 (b) of the former Enforcement Decree of the Inheritance Tax Act, notwithstanding the fact that there is no other appropriate evaluation method, the court below, considering the evaluation value based on the above appraisal as corresponding to the market price which reflects the objective exchange value of the stock in this case and calculate it accordingly, there is an error

Therefore, the judgment of the court below shall be reversed and remanded, and it is so decided as per Disposition by the assent of all participating Justices.

Justices Ansan-man (Presiding Justice)