Since it cannot be deemed that the excavation work was conducted, it cannot be deemed that it constitutes the land annexed to the building under construction.

Since it cannot be deemed that construction work was conducted on the ground, it cannot be deemed that it constitutes the land annexed to a building under construction, and thus, it cannot be deemed as a special aggregate taxation under the Comprehensive Real Estate Tax

Article 103 of the Enforcement Decree of the Gu Local Tax Act (Scope, etc. of Buildings)

2017Guhap21700 Revocation of Disposition of Imposition of Comprehensive Real Estate Tax

AA Corporation

BB Director of the Tax Office

November 22, 2017

December 22, 2017

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s imposition of comprehensive real estate holding tax for the year 2013 against the Plaintiff on July 1, 2015 and the imposition of KRW 14,73,240 for special rural development tax and special rural development tax for the year 2013 shall be revoked.

1. Details of the disposition;

A. The Plaintiff’s ground of acquisition

As a company operating real estate development business, the Plaintiff entered into a sales contract with CCC on the instant land and acquired the instant land.

1) Sales contract dated 27, 201

A) The Plaintiff purchased at KRW 7.35,663.8m2 (hereinafter referred to as “one parcel of land”) in 200,000,000 for 7.35,648m2 (hereinafter referred to as “OO-dong O-dong”) from CCC, and entered into a sales contract with the effect that the remainder of the purchase price shall be paid on the date of the contract and paid in six installments until December 27, 2014.

B) Unlike the method of payment under the above contract, the Plaintiff paid KRW 735,648,00 on the day of the contract to the Defendant. On June 27, 2012, the Plaintiff paid KRW 6,124,029,930 for the remainder after receiving advance payment, and paid KRW 768,00 for the portion of KRW 0.8 square meters increased through July 4, 2013.

C) On July 5, 2013, CCC completed the registration of ownership transfer on the land No. 1.

2) Sales contract dated April 20, 2012

A) The Plaintiff concluded a sales contract with CCC to purchase KO-1 O-1 3,965.6 m2 (hereinafter referred to as “2 land” and “the instant land” in total of Nos. 1 and 2) in KRW 2,775,960,000,000, and the contract deposit shall be paid on the date of the contract, and the remainder of the purchase price shall be paid in six installments until April 20, 2015.

B) Unlike the method of payment under the above contract, the Plaintiff paid KRW 277,596,00 on the day of the contract to the Defendant. On June 27, 2012, the Plaintiff paid KRW 2,541,498,320 to the Defendant with advance payment, and paid KRW 3,925,600 on the portion of KRW 5.6 square meters increased through the settlement of the area on July 4, 2013.

C) On July 5, 2013, CCC completed the registration of ownership transfer on the second land.

(b) Acceptance, etc. of construction permits and building permits revoked;

1) On November 19, 2012, the Plaintiff was granted a building permit on the instant land for the purpose of using the first underground floor, the business facilities of the third floor above ground, the second-class neighborhood living facilities, etc., and thereafter, on August 8, 2013, the Plaintiff submitted to the head of KK-Metropolitan City OO (hereinafter “the head of KOO”) for the revocation of the said building permit on the ground of a planned modification.

2) Meanwhile, on June 21, 2013, the Plaintiff leased the instant land to EE Development Co., Ltd. for the purpose of constructing and using a model house, and on August 28, 2013, a temporary building construction report certificate was issued on the instant land on the ground.

C. The defendant's disposition of this case

1) On September 3, 2013, the head of the OO: (a) the Plaintiff deemed the instant land owned as of the tax base date ( June 1, 2013) as the land annexed to a building under construction; and (b) divided the instant land into separate aggregate taxation and imposed property tax in 2013; (c) the Defendant received a notification from the head of OO of the imposition data on property tax from the Plaintiff on November 16, 2013; and (d) determined and notified the Plaintiff of comprehensive real estate holding tax 1,294,80 won for the year 2013 and special rural development tax 258,960 won for special aggregate taxation.

2) After October 13, 2014, the head of the OO made a correction and notification of KRW 8,477,970, including property tax, etc. in 2013 to the Plaintiff on the ground that the Plaintiff failed to submit a report on commencement of construction as of June 1, 2013, and that the Plaintiff submitted a request for revocation of the building permit as above, and that the instant land constitutes a general aggregate taxation subject to general aggregate taxation, and submitted data on the change in the amount of property tax to the

3) Accordingly, on July 1, 2015, the Defendant sent the instant land to the Plaintiff as a general aggregate taxation subject to general aggregate taxation, and revised and notified the Plaintiff of the comprehensive real estate holding tax amounting to KRW 73,66,200 for the year 2013 and special rural development tax amounting to KRW 14,73,240 for the Plaintiff (hereinafter “instant disposition”).

(d) Procedures of the previous trial; and

The Plaintiff was dissatisfied with the instant disposition and filed a request for review with the Board of Audit and Inspection on October 2, 2015, but on February 16, 2017, the request for review was dismissed and served on March 2, 2017.

Facts without any dispute, Gap's 1 through 3 (including each number; hereinafter the same shall apply), Eul's 1 to 3, the purport of the whole pleadings, and the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The "land annexed to a building" under Article 106 (1) 2 (a) of the Local Tax Act includes "land annexed to a building under construction" under Article 103 (1) 3 of the Enforcement Decree of the same Act. However, around November 19, 2012, before the tax base date, the Plaintiff purchased a building permit for business facilities and neighborhood living facilities on the land of this case, and conducted a construction work such as a ground-breaking construction from around that time. However, the Plaintiff did not report the commencement of construction. Since the Plaintiff leased the land of this case as a model-building site, the Plaintiff’s land should be leased as a model-building site, and the Defendant should also suspend the construction permit of this case and cancel the construction permit of this case as at the time of the general aggregate taxation because it constitutes a "land subject to general aggregate taxation" under Article 103 (1) 3 of the same Act.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

(c) Fact of recognition;

According to each of the above evidence, Gap evidence Nos. 4 through 32, Eul evidence Nos. 4 through 18 and video, the following facts are recognized:

(1) Building permission and the details of its revocation

A) On September 3, 2012, the Plaintiff entered into a contract for construction works with D Construction to newly construct a "Odong neighborhood living facility (hereinafter referred to as "the instant building") on the instant land (hereinafter referred to as "new construction works of the instant building") at KRW 2.31 billion (including each value-added tax (including construction cost of KRW 1.76 billion, civil construction cost of KRW 550 million, and each value-added tax), and paid KRW 50 million on September 5, 2012, and January 31, 2013, and paid KRW 50 million in advance for D Construction on September 14, 2012).

B) On September 30, 2012, the Plaintiff entered into a building design agreement with an architect OO on the construction of the instant building.

C) On November 6, 2012, the Plaintiff filed an application with the Defendant for a building permit to construct the instant building on the instant land with a total floor area of 1,593.15 square meters, total floor area of 4,501.73 square meters, and a total floor area of 1,501.73 square meters on the instant land, and with a total of 1/3 square meters underground, and received the building permit from the Defendant on November 19,

D) The Plaintiff did not file a report on the commencement of the construction of the instant building with the Defendant, and submitted a revocation of the construction permit to the Defendant on the grounds of a change in the plan around August 2013, and accepted it on August 8, 2013.

E) After that, around September 30, 2013, the Plaintiff agreed to handle 500 million won, which was paid in advance with DD Construction, as expenses under other Sections.

(ii) leasing a model house site;

A) On June 21, 2013, the Plaintiff entered into a lease agreement with EE Development Co., Ltd. and FF Comprehensive Construction (hereinafter “E Development”) on the lease of KRW 350,640,000 for two years, to EE development, etc. which constructs a model house of the instant land. Article 5 of the lease agreement states that “the Plaintiff is obligated to deliver the land to the lessee as a site.”

B) On August 8, 2013, EE Development, etc.: (a) made a report on the construction of a temporary building on the construction of a sample house with a total floor area of 1,824.28 square meters on the ground of the instant land; and (b) the report was accepted on August 26, 2013.

3) Results of fact inquiry

A) The result of the fact-finding conducted on August 1, 2017 by this Court on the Head of CCCH regional headquarters

[Written reply of August 1, 2017]

○ The instant land is a site for support facilities in the GG2 Zone 1 (the completion of the project: December 31, 2012) and the construction was completed upon completion of the project at the time of delivery, and was created in a state where there is a legal surface in the land as follows, as the cross-section 1.

B) The result of the fact-finding conducted on September 14, 2017 by this Court on the Head of CCC H Area Headquarters

[Written Answer of September 14, 2017]

○ 1-level project implementation schedule for GG2 district

- - May 31, 2012: The timing of land use;

- December 31, 2012: The date of payment of the area settlement as a result of a final survey

- December 31, 2012: Date of completion of the project;

- - February 7, 2013: The date of registration for the preservation of a target district.

When full payment of the price is made before the date of registration for the preservation of the project district ( February 7, 2013) and use land (such as building permission, change of the form and quality) is made, a written consent shall be issued and submitted to the building permit-granting authority after applying for the use of land to our Corporation, and the land can be used as at June 27, 2012 shall be submitted to the building permit-granting authority

C) The result of the fact-finding inquiry conducted on August 2, 2017 to the head of the OO of this Court

The head of the OO head sent a field photograph before and after the commencement of the land creation work (see attached Form 2. The photograph). However, the photographs are attached to the document submitted by the Plaintiff to the head of the OO on May 14, 2015 (Evidence 4-2).

D) The result of the fact-finding conducted on September 14, 2017 to the head of the OO of this Court

[Written Answer of September 14, 2017]

○ The Plaintiff entered into an annual installment contract, but on June 27, 2012, the Plaintiff paid the full amount of the land price, thereby causing the acquisition tax liability to pay acquisition tax on the acquisition date.

D. Relevant legal principles

1) Generally, the burden of proving the fact of taxation requirements exists in a lawsuit seeking the revocation of tax imposition disposition. However, in a case where the facts can be inferred in light of the empirical rule in the course of a specific lawsuit, unless the other party proves his/her opposing circumstance, such as that the pertinent facts at issue are inappropriate to apply the empirical rule, it cannot be readily concluded that the pertinent taxation disposition is an unlawful disposition that lacks the taxation requirements (see, e.g., Supreme Court Decisions 2002Du6392, Nov. 13, 2002; 2006Du13831, May 29, 2008).

2) Article 11 of the Gross Real Estate Tax Act provides that comprehensive real estate holding tax on land shall be imposed separately from general aggregate taxation subject to Article 106(1)1 of the Local Tax Act and special aggregate taxation subject to Article 106(1)2 of the same Act on land located in Korea. Article 106(1)2(a) of the former Local Tax Act (amended by Act No. 11873, Jun. 7, 2013; hereinafter the same shall apply) provides that land annexed to a building prescribed by Presidential Decree, such as land annexed to a building for factories, shall be subject to special aggregate taxation; Article 101(1) and Article 103(1)5 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 25058, Jan. 1, 2014; hereinafter the same shall apply) provides that construction works on land shall be deemed as construction before the commencement of construction work on land prescribed by Ordinance of the Ministry of Construction and Transportation; Article 106(2) of the Building Act shall be deemed as construction permission for at least six months after the tax base date.

E. Specific determination

1) Order of determination

On the other hand, the plaintiff asserts that since most of the ground-breaking construction work was completed on the land of this case, the construction of the building should be deemed to have been commenced at that time, the defendant argued that even if the plaintiff did not perform the ground-breaking construction work on the land of this case and even if the plaintiff performed a site-building construction work on the land of this case, it is merely a preparatory act for the construction of the building site, this does not constitute "land annexed to the building under construction".Therefore, in the below, I will first examine whether the plaintiff was merely a construction for the construction of the building of this case on the land of this case or a construction for the construction for the site-building such as flatization work on the land of this case, and ② if the plaintiff performed only the site-building construction work, it can be seen as "land annexed to the building under construction."

2) Whether the Plaintiff performed the new construction of the building, such as the excavation work

In full view of the facts acknowledged above and the following circumstances revealed in the argument of this case, it is difficult to view that the plaintiff performed the new building construction work, such as the ground-breaking construction work, and only a part of the site construction work such as the flatization work of the site was conducted.

A) In order to construct a building at the initial stage of the construction work, the construction work must be reported as prescribed in Article 21 of the Building Act, in addition to the construction permission granted under Article 11 of the Building Act. If the construction starts without reporting the commencement of the construction work without reporting the commencement of the construction work, the administrative agency may order the owner, etc. to suspend, remove, or prohibit the use of the building (Article 79(1) of the Building Act). With respect to the building for which a corrective order has not been issued, the administrative agency may request the owner, etc. not to permit the operation and other acts under other Acts and subordinate statutes of the building (Article 79(2)), the person in receipt of the request shall comply with the request unless there is any special reason (Article 79(3)), and the administrative agency may impose a charge for compelling the performance on the owner, etc. who has failed to comply with the corrective order (Article 80(1)), and the person who has failed to report the commencement of the construction work may be punished by a fine not exceeding 50,000 won (Article 111).8).

B) On September 3, 2012, the Plaintiff contracted the instant new construction of the building to DD construction, and it is also difficult to accept that DD construction specialized in civil engineering and construction works did not report the commencement of construction. Moreover, even if DD construction is granted permission on November 19, 2012, the Plaintiff also did not report the commencement of construction and did not report the commencement of construction, and there seems to be no reason for the Plaintiff to destroy the land as the commencement of construction (the Plaintiff asserted that the Plaintiff commenced construction before the completion of the ownership transfer registration of the instant land to construct the building as soon as possible, and did not explain why it did not report the commencement of construction).

C) In addition, the lease contract that the Plaintiff prepared while leasing the instant land to EE Development, etc. as a site for a model house, decided to deliver the instant land to EE or to the site condition. If the Plaintiff, if it was intended to construct the instant building on the ground of the first and third floors underground, it is difficult to regard it as a site, and there is no underground floor in the model house, and rather, the Plaintiff as the Plaintiff did not present any evidence to deem that the Plaintiff transferred the excavated land to EE development, etc., and there is no such assertion.

D) On September 30, 2013, the Plaintiff asserted that construction cost for the instant new construction work was paid KRW 1.766 billion for the said construction work, and KRW 2.31 billion for the civil engineering work, and agreed to pay KRW 500 million for advance payment within seven days from the contract date, and that KRW 500 million was paid for D Construction. The Plaintiff agreed to treat KRW 500 million for another cost on September 30, 2013. The Plaintiff had already completed D Construction and paid KRW 500 million for the said construction work. However, it is reasonable to view the Plaintiff’s construction work as including the aforementioned construction work’s boundary restoration work or ground investigation, felling, planting, planting, and transplantation of trees, installation of a fence for the prevention of dust, installation of a site, and an access road for the construction work, and it is more reasonable to view the Plaintiff’s construction work as its first stage or construction work’s construction work’s construction work’s construction work’s construction work’s construction work’s construction work.

E) The Plaintiff submitted as evidence a photograph (Evidence No. 29) that the excavation work, etc. was already conducted at the time of the tax base date (on June 1, 2013), but there is insufficient evidence to acknowledge that the photograph was taken at the time of the tax base date (the result of the inquiry of the head of the OO of this court on August 2, 2017). Moreover, the same photograph as the photograph No. 29 is attached to the land creation work before and after the fact-finding work, while the photograph was attached to the copy submitted by the Plaintiff to the head of the OO on May 14, 2015. However, even according to the images shown in the photograph, it is insufficient to view that the work was conducted more than the flat work on the site and constitutes the excavation work for underground construction or the excavation work for underground floors.

F) The Plaintiff asserted to the effect that “the ground investigation was commenced prior to the commencement of the construction work for the instant land by requesting J geological features and obtaining the construction permit (the third side of the Plaintiff’s preparatory document, Sept. 25, 2017).” As the construction permit date was November 19, 2012, the Plaintiff’s assertion that the ground investigation report was conducted from the lower police officer on November 2012, 2012. Furthermore, the ground investigation report was prepared in order to ensure the stability of construction work and ground by identifying the geological characteristics and the construction work for the ground destruction work before the implementation of the construction work for the instant land, and thus, it should be deemed that the excavation work or the ground destruction work was not commenced at least from around 10 days after the date of the completion of the ground investigation report (see, e.g., [Attachment 30] report on the ground excavation work to the Plaintiff from around 20 days before the date of the completion of the construction work for the ground excavation work (see, e.g., photograph No., the Plaintiff’s photograph No.

3) Whether the instant land constitutes “land annexed to a building under construction” even where the Plaintiff exclusively executed a site development project

A) According to the result of the fact-finding conducted by the CCC head on August 1, 2017, the instant land was created in a state where GG2 was completed at the time when it was delivered to the Plaintiff. However, according to the photographs attached to the ground investigation report prepared around November 2012, 2012, the instant land was already removed to a certain extent and the instant land was relatively flatized. Accordingly, the Plaintiff appears to have performed the work of removing such laws after being delivered the instant land from CCC under the condition where the land was transferred to the Plaintiff.

B) However, for the following reasons, the Plaintiff’s work of flatizing the instant land:

On the sole basis of the fact that part of the site creation work was carried out, it cannot be deemed that the land in this case constitutes a “land annexed to a building under construction.”

(1) In order to construct a new building with underground floors like the instant building, it is necessary to excavate the site of the building to construct a new building, and it is necessary to install a saves, install a saves, install a saves, install a saves, or conduct soil-proof work. As such, it is necessary to excavate the site of the building and sell a saves, namely, to install a saves to indicate the location and height of the building, and the width and depth of the ground-breaking in the construction site, or to install a saves to display the saves to the construction site, and to install soil saves.As a matter of course, in the construction process of the building, the construction work of the existing building or obstacles, the removal of the existing building or obstacles, the temporary fence to prevent dust, the installation of a temporary fence to prevent dust, the construction of an access road, the construction of a site report, and the construction of the site.

The Plaintiff asserts to the effect that, on March 15, 2017, if a site creation act was conducted, the construction work should be deemed to have been commenced. However, the foregoing Supreme Court’s judgment was related to the case where, although the construction of the ground-breaking construction or structure was not commenced, the soil shield inevitably required as a whole stage and the case where the construction of the ground-breaking construction or structure was conducted, and the case where the construction of the ground-breaking construction or structure, which is the premise thereof, was conducted. Therefore, the Plaintiff’s assertion cannot be the basis for supporting

The Supreme Court Decision 2012Du22973 Decided July 11, 2017 seems to have started construction of a new building under the Building Act, barring any special circumstance, the work should commence such as the excavation of the site of the new building or the construction of the new building. Thus, it cannot be said that there was a commencement of construction work or construction work falling under the preparatory act for the construction of the new building, such as removal of the existing building or facilities, planting of trees or trees, construction of the site of the new building, construction of the new building, and construction of fences or access roads, etc. under the Building Act.The legal judgment on whether the concept of "the commencement of construction of the new building" under the Building Act and "the construction of the new building" under the Local Tax Act are the same, and at least the construction of the boundary restoration or ground survey, the building site of the new building, the construction of the new building site of the new building, the temporary fence or access road construction, etc. is merely a preparation act necessary for the construction of the building.

Applicant The Plaintiff asserts to the effect that the instant land constitutes the land annexed to a building under construction, as long as the Plaintiff performed site preparation work, etc., on the ground that Article 103(1)3 of the Enforcement Decree of the Local Tax Act as amended on January 1, 2014 includes “a building under construction” in the scope of “building under construction” and “a building that is planned to be constructed on the land before completion inspection or use approval is granted.”

Article 103(1)3 of the Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 25058, Jan. 1, 2014) provides that "a building under construction (including a building for which construction is scheduled to be built on the land (excluding the land subject to the separate taxation under Article 106(1)3 of the Act) provided by the operator of a development project under related Acts and subordinate statutes to such development project after obtaining approval of the implementation plan for the development project, which is the land (excluding the land subject to the separate taxation under Article 106(1)3 of the Act) that is to be provided as land attached to the building before the completion inspection or use is

However, the above provision applies from the first time to the Enforcement Decree of the Local Tax Act which was amended by Presidential Decree No. 25058 on January 1, 2014 (Presidential Decree No. 25058, Jan. 1, 2014) pursuant to Article 2 of the Addenda to the Local Tax Act (Presidential Decree No. 25058, Jan. 1, 2014), and the first liability for tax payment is established after January 1, 2014. Thus, the above provision cannot be applied to the instant case where the liability for tax payment was established on June 1, 2013. ② Even according to the above provision, the Plaintiff cannot be deemed to have been applied as a matter of course to the Plaintiff since it was not a development project implementer, but a development project implementation plan was not approved. ③ In the case of building site construction, which is not a construction project to be newly built, the above provision cannot be deemed as land annexed to the building under construction. On the other hand, since Article 103(1)3 of the Enforcement Decree of the Local Tax Act should be interpreted strictly and thus cannot be accepted.

F. Sub-committee

In full view of the above, the Plaintiff cannot be deemed to have performed the construction work on the instant land as the commencement of construction work, and the mere fact that the construction work on the site was completed partially, the instant land cannot be deemed to fall under the “land annexed to a building under construction.” Therefore, the instant land cannot be deemed as the “land annexed to a building under construction” under the Comprehensive Real Estate Holding Tax Act, and the instant disposition taken in the same field is lawful.

3. Conclusion

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