[1] Whether a corporation which conducts a business of purpose of housing construction, etc. is excluded from the scope of non-business land in a case where a justifiable ground exists even if the land acquired for housing construction is not used for housing construction within 4 years or is disposed of by sale

[2] In a case where a corporation whose main business is real estate sales acquires land for housing construction and sells it within one year after converting it into sale and sale within one year, whether it constitutes land for non-business use (negative)

[3] The standard point of time to view that the sale of land by a corporation that mainly engages in real estate sales business is directly used for its unique business

[1] According to Article 84-4 (4) 10 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14481 of Dec. 31, 1994), where a corporation which intends to build, supply, or lease a house does not use the land acquired for housing construction for the purpose of housing construction or sells it to another company within four years or within four years from the date of acquisition, the relevant land does not constitute "land which is not deemed land for non-business use of the corporation" but does not constitute "land for non-business use of the corporation" if there are justifiable reasons for the disposition of non-use or sale of the land

[2] In light of Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14481, Dec. 31, 1994); Article 84-4 (3) and (4) of the same Act, when determining the general scope of non-business land of the juristic person, there is no restriction on the original purpose of acquiring the land; and when a juristic person who engages in real estate sales business acquires land for housing construction and sells it after converting it into sale within one year from the date of acquisition, the land shall be excluded from non-business land under Article 84-4 (4) of the former Enforcement Decree of the Local Tax Act even if it cannot be excluded from non-business land under paragraph (1).

[3] In a case where a corporation that runs a real estate sales business sells land for sale, if it concludes a sales contract to sell the relevant land and receives the down payment, it shall be deemed that it used directly for its unique business unless there are special circumstances.

[1] Article 112 (2) of the former Local Tax Act (amended by Act No. 4794 of Dec. 22, 1994); Article 84-4 (4) 10 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14481 of Dec. 31, 1994) / [2] Article 112 (2) of the former Local Tax Act (amended by Act No. 4794 of Dec. 22, 1994); Article 84-4 (1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1481 of Dec. 31, 1994) / [3] Article 112 (2) of the former Local Tax Act (amended by Act No. 4794 of Dec. 22, 1994); Article 84-4 (2) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1484 of Dec. 14, 199484, 194)

[1] Supreme Court Decision 93Nu17546 delivered on May 13, 1994 (Gong1994Sang, 1735) / [2] Supreme Court Decision 95Nu9457 delivered on November 28, 1995 (Gong1996Sang, 277) / [3] Supreme Court Decision 95Nu9457 delivered on November 28, 1995 (Gong196Sang, 277)

Sejong Housing Construction Co., Ltd. (Attorney Seo Ho-ho, Counsel for the plaintiff-appellant)

Market for macro-market

Busan High Court Decision 95Gu5387 delivered on October 9, 1996

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

We examine the grounds of appeal.

A. On the first ground for appeal

In light of the records, it is proper that the court below recognized the Plaintiff as the purchaser of the land in this case as the taxpayer for acquisition tax, and there is no illegality such as misconception of facts such as theory of lawsuit. There is no reason to discuss

B. On the second ground for appeal

According to Article 84-4 (4) 10 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 1481 of Dec. 31, 1994; hereinafter the same), where a corporation which intends to build, supply, or lease a house does not use the land acquired for housing construction for the purpose of housing construction or sells it to another company within four years from the date of its acquisition, the land concerned does not constitute "land which is not deemed land for non-business use of the corporation" but does not constitute "land for non-business use of the corporation" if there is a justifiable reason for the disposition of non-use or sale (see Supreme Court Decision 93Nu17546 delivered on May 13, 1994).

The court below held that the land of this case is the land acquired by the plaintiff corporation for the purpose of constructing a house (house) on its ground, but it does not fall under the "land which is not deemed land for non-business use of the corporation" under Article 84-4 (4) of the Enforcement Decree of the Local Tax Act since the plaintiff sold it within four years from the date of its acquisition, and there is no justifiable reason to dispose of it. In light of the records and the relevant provisions, the above decision of the court below is proper and there is no error in the misapprehension of legal principles, such as theory of lawsuit.

C. On the third ground for appeal

According to the reasoning of the judgment below, the court below determined that the land of this case falls under the land for housing construction under Article 84-4 (4) 10 of the Enforcement Decree of the Local Tax Act and the land acquired for the purpose of sale to a third party does not constitute land for sale under Article 84-4 (3) 2 of the Enforcement Decree of the Local Tax Act. Thus, even if the plaintiff was a corporation engaged in real estate sales business at the time of the sale of the land of this case, so long as the land of this case cannot be viewed as land for sale, it cannot be viewed as directly used for its unique business because the plaintiff's sale of the land of this case cannot be viewed as a land for sale. Thus, the land of this case constitutes land for

However, Article 84-4 (1) of the Enforcement Decree of the Local Tax Act stipulating the scope of land for non-business use of a corporation among acquisition tax provides that land for non-business use of a corporation shall not be used directly for its unique business within one year from the date of its acquisition without justifiable reasons. Paragraph (3) provides that land for non-business use of a corporation shall be deemed land for non-business use of a corporation under Paragraph (1) and Paragraph (4) provides that a corporation which does not engage in real estate sales business shall sell it to a third party. Paragraph (4) provides that land for non-business use of a corporation under Paragraph (1) of the same Article shall not be deemed land for non-business use of a corporation under Paragraph (1) of the same Article and Paragraph (4) of the same Article provides that 4-4 of the Enforcement Decree of the Local Tax Act provides that land for non-business use of a corporation under Paragraph (1) of the same Article shall not be included in the grace period for non-business use of a corporation under Paragraph (1) of the same Article.

In addition, in the case of such sale, if a sales contract for selling the pertinent land was concluded and the down payment was received, it shall be deemed that it was used directly for its unique business (see Supreme Court Decision 95Nu9457 delivered on November 28, 195).

Therefore, the court below should have determined whether the land of this case constitutes land for non-business use of a corporation by examining whether the plaintiff is a corporation whose main business is real estate sales business or the date of conclusion of sales contract and receipt of down payment for the land of this case within one year from the date of acquisition of land, and without doing so, the court below determined that the land of this case constitutes land for non-business use of a corporation. The court below erred in the misapprehension of legal principles as to land for non-business use of a corporation, which affected the conclusion of the judgment.

Therefore, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Jong-sik (Presiding Justice)