early 2009west0938 ( October 26, 2009)

Time of transfer of stocks whose pledge is established;

The transfer of shares takes effect with the intention of the parties to the transfer and the delivery of share certificates, except in extenuating circumstances, however, since the pledge is established only on the property value of the shares for which the pledge is established, the transfer is deemed to have been made at the time

The contents of the decision shall be the same as attached.

1. The plaintiff's claim is dismissed.

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

On December 8, 2008, the Defendant confirmed that a disposition imposing capital gains tax of KRW 331,714,490 on the Plaintiff for the year 2004 is null and void.

1. Details of the disposition;

A. On December 26, 1990, the Plaintiff acquired 25,000 shares re-stocks 25,00 shares listed in attached Table 1 issued by AAF Co., Ltd., a non-listed stock company (hereinafter “instant shares”).

B. On February 1, 1993, the Plaintiff entered into a pledge agreement with Samyang Co., Ltd. (hereinafter referred to as the “Non-Party Co., Ltd.”) on the condition that the Plaintiff’s secured debt amount of KRW 2 billion in order to secure the obligation against the non-party Co., Ltd. (hereinafter referred to as the “Non-Party Co., Ltd.”), a representative director, and that the non-party Co., Ltd. acquires the share income of this case, which is a pledged article, and would be appropriated for the repayment

C. On February 1, 1994, the Plaintiff filed an application for registration of the shareholder registry with respect to the above pledge against AAF Co., Ltd., and the register of shareholders entered the contents of the pledge on the shares of the non-party company in the shareholder registry.

D. On March 21, 1994, between the plaintiff and the non-party company, the plaintiff was the respondent and the non-party company as the applicant and the Seoul Central District Court (formerly changed: Seoul Central District Court) as 94Ra193 (hereinafter referred to as the "conciliation in this case") was established with the following contents:

1. By April 30, 1994, the respondent shall pay to the applicant the debt amount of KRW 2 billion as joint and several surety of the new quota stock company.

2. If the Respondent fails to perform the obligation of Paragraph 1 above by the due date, the Respondent shall implement the transfer procedure for entry of ownership in the register of shareholders in the name of the Respondent with respect to all the shares indicated in the attached list (the shares in this case) owned by the Respondent deposited in the

3. The Respondent shall terminate the pledge on the listed shares in the separate sheet owned by the Respondent and refund all the share certificates to the Respondent when the Respondent fully pays its debt under the above paragraph 1.

E. On April 21, 2004, the non-party company requested transfer of ownership of the shares of this case to AAF Co., Ltd. based on the instant protocol of conciliation, and registered it as the owner of the shares of this case in the register of shareholders.

F. Around December 8, 2008, the Defendant rendered the instant disposition imposing KRW 331,714,490 of the capital gains tax belonging to the year 2004 on the ground that the Plaintiff transferred the instant liquor to the non-party company on April 21, 2004.

[Reasons for Recognition] Each entry of Gap evidence 1, 2, Gap evidence 3, 4, Gap evidence 5-7, and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

(1) As the Plaintiff failed to repay the joint debt amounting to KRW 2 billion to the non-party company until April 30, 1994, on May 1, 1994, the ownership of the instant shares was transferred to the non-party company as a matter of course in lieu of performing the joint debt amounting to KRW 2 billion pursuant to the instant protocol of conciliation, and the transfer price of the instant shares was settled, the time of transferring the instant shares was May 1, 1994. Accordingly, the instant disposition of imposition on December 8, 2008, which was issued by the Defendant on May 1, 1994 after the lapse of five years of the exclusion period from imposition, is null and void after the exclusion period expires.

(2) In addition, since the settlement of this case was established and the non-party company continues to exercise all rights such as exercising voting rights and receiving dividends as a substantial shareholder of the shares of this case, the imposition of this case is null and void in violation of the principle of substantial taxation.

(b) Related statutes;

Attached Table 2 is as shown in the list.

C. Determination

(1) As to the plaintiff's first argument

(A) According to Article 26-2 (1) 2 of the former Framework Act on National Taxes (amended by Act No. 4810 of Dec. 22, 1994; hereinafter the "former Framework Act on National Taxes"), the exclusion period of capital gains tax shall be five years from the date on which the transfer income tax can be imposed. According to Article 26-2 (1) 2 of the Framework Act on National Taxes (amended by Act No. 7329 of Jan. 5, 2005; hereinafter the "Framework Act"), the exclusion period of capital gains tax shall be seven years from the date on which the transfer income tax may be imposed if the taxpayer fails to file a tax base return within the statutory due date of return. Unless the exclusion period of special exception under Article 26-2 (2) of the same Act is applicable, the imposition period after the expiration of the exclusion period of capital gains tax shall be null and void (see, e.g., Supreme Court Decision 2007Du24364, May 28, 2009).

(B) Since whether the exclusion period for transfer income tax of the instant shares has expired, it is closely related to the transfer date, the following is about the transfer date of the instant shares.

On February 1, 1993, the Plaintiff concluded a pledge agreement on the shares of this case with the non-party company as above and delivered the share certificates to the non-party company. The non-party company was registered as pledgee of the shares of this case on February 1, 1994, the Plaintiff and the non-party company, who is a pledger, paid the joint debt of the above 2 billion won on March 21, 1994 to the non-party company until April 30, 1994. If the Plaintiff delays this, the settlement was formed between the non-party company 40 to the non-party company's 30.4 billion won on April 2, 2004, and the non-party company was named as the owner of the shares of this case on April 2, 200 to the non-party 30.4 billion won on the list of shareholders of this case on April 2, 200 to the non-party company's 30.4 billion won on the aggregate of shares of this case.

According to the above, the settlement between the plaintiff and the non-party company was established when the non-party company possessed the share certificates of this case as a pledgee of this case, and even after the settlement of this case was established, the plaintiff cannot be deemed to have exercised its authority as a shareholder of this case, and the contents of the settlement of this case or the settlement of this case after May 1, 1994, the non-party company may exercise the right to acquire ownership of this case in lieu of the joint and several liability amounting to the above 2 billion won as long as the plaintiff did not repay the above debt after May 1, 1994. Since the plaintiff, the pledgee, after May 1, 1994, can terminate the above contract of this case by paying the joint and several liability amounting to the above 2 billion won prior to the exercise of the above right, it is reasonable to view that the non-party company could not exercise the above right under the settlement of this case before the expiration of the period of imposition of 20 billion won under Article 27 of the National Tax Act.

(2) As to the second argument by the Plaintiff

According to the provisions of Article 340 of the Commercial Act, a pledgee of shares is entitled to receive profits from the issuing company, to pay the dividends of interest, the distribution of residual assets, etc., and to apply them to the repayment of secured claims. On the other hand, in the event shares are deposited, a pledge is established only to the value of the shares. Therefore, a pledgee may not exercise his/her voting rights or other

According to the above, the non-party company, as a registered pledgee of the shares of this case, received profit dividends as above under the provisions of Article 340 of the Commercial Act or the above pledge agreement, and appropriated it as part of the principal and interest of the non-party company of this case's joint debt amounting to 2 billion won against the non-party company. In addition, even if the non-party company exercised the voting right of the shares of this case, it can be deemed that the non-party company's exercise the voting right of the shares of this case as the plaintiff's authorized agent rather than exercising the voting right directly as the owner of the shares of this case. Thus, it is difficult for the non-party company to continue to exercise its power as the owner of the shares of this case after the settlement of this case. Thus, the plaintiff's assertion that the taxation of this case based on the premise that the non-party

(3) Ultimately, the instant disposition that the Defendant reported the time of the transfer of the instant shares on April 21, 2004 is lawful.

3. Conclusion

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