Cho Jae-2012-west-4708 ( December 31, 2012)

It does not fall under the case of allocating the securities by the public offering method under Article 2 (3) of the Securities and Exchange Act.

It appears that the report of securities was withdrawn and the method of public offering of new securities was abolished, and the measures of public offering were taken in accordance with the private placement method, and there was no sanctions imposed by the Financial Supervisory Commission on the ground that the report was not performed at the time of offering new stocks by the public offering method, and thus, it does not constitute the case of allocating the securities to the public offering method in accordance with

2012Guhap36309 Revocation of Disposition of Imposition of Gift Tax

AAA

Head of the District Tax Office

September 18, 2014

October 30, 2014

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The imposition of gift tax by the Defendant against the Plaintiff on August 1, 2012 is revoked. The imposition of gift tax by the Plaintiff is revoked.

1. Details of the disposition;

(a) Particulars for capital increase;

(1) On May 5, 2007, 2007, B changed from CC, a corporation listed in the securities market, to 'DD Energy' around June 2007, and changed from 'EE' to 'EE' to 'the stock company'. On September 201, hereinafter 'the company of this case'), the company of this case agreed to take over management rights of the company from 24% of the existing major shareholders capital of 'EE' to 'EE'. On the same day, the company of this case decided to take over 24% of the shares of GGG, a corporation of Russia, in order to enter into the development industry such as genetic exploration and extraction, and made a resolution of the board of directors on capital increase in Korea for the purpose of raising the fund.

On the other hand, in order to offer securities of GG or higher under the Securities and Exchange Act (amended by Act No. 8635 of Aug. 3, 2007), an issuer shall submit a securities registration statement to the Financial Supervisory Commission in accordance with Article 8 of the Securities and Exchange Act and Article 2 of the Enforcement Rule of the same Act (amended by Presidential Decree No. 885 of Aug. 4, 2008). On May 3, 2007, the company of this case reported the securities for the third party allotment, but was ordered to submit a corrective registration statement twice by the Financial Supervisory Commission. In the end, on August 1, 2007, the final party to the allocation of the third party to the Financial Supervisory Commission was only 49 and did not constitute the “securities offering order” under Article 2(3) of the Securities and Exchange Act and Article 2-4(1) and (3) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 2051 of Jan. 18, 2008).

Class and number of new shares: 91,589,100 shares of registered common shares

0 Purpose of financing: Project funds to promote new projects;

○ Issue Price of New Stocks: OOO per share (OOO whose par value per share is OO).

○ Total amount of new shares issued: OOO

○ Payment date of subscription money: August 16, 2007

○ New Stocks to be allocated: BB et al. 51

The full amount of ○ New Stocks issued is expected to be protected by the Korea Securities Depository for one year from August 27, 2007.

(2) The Plaintiff participated in the capital increase with new shares issued in the instant case and acquired 1,218,020 shares of the instant company as an OOO of the payment amount per share.

(b) Disposition, etc.;

From April 30, 2012 to June 8, 2012, the commissioner of the Daegu Regional Tax Office: (a) conducted an investigation into changes in shares with respect to the instant company; and (b) “The instant capital increase is not made by means of public offering of new shares; (c) the Plaintiff was notified of the existing shareholders of the instant company (amended by Act No. 8828, Dec. 31, 2007; hereinafter “Inheritance Tax and Gift Tax”) under Article 39(1)1(a) of the Inheritance Tax and Gift Tax Act and Article 29(3)1(4) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 20621, Feb. 22, 2008) (amended by Presidential Decree No. 20621, Aug. 14, 2007; (d) the assessed value of the instant company’s 150O,515.5% of the total capital increase (amended by Presidential Decree No. 150650,51).5% per share).

(2) On August 1, 2012, the Defendant imposed each disposition on the Plaintiff on August 1, 2012 (hereinafter “each disposition of this case”) on the gift tax OOO(MaintenanceF donation), OOO(OOH donation), and OOO(OOE donation) upon the Plaintiff on August 1, 207 (hereinafter “instant disposition”).

(3) Accordingly, the Plaintiff filed an appeal with the Tax Tribunal on October 31, 2012, but was dismissed on December 31, 2012.

Facts that there is no dispute over recognition, Gap's evidence 1 through 8, Eul's evidence 1 (including branch numbers; hereinafter the same shall apply), and the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) Article 39(1)1 of the Inheritance Tax and Gift Tax Act provides that no gift tax shall be levied on capital increase issued by a third party under the "securities offering method" under Article 2(3) of the Securities and Exchange Act. The term "securities offering" refers to the case where 50 or more persons who have received an offer to acquire securities have made an offer by holding several presentation sessions for investment. However, even if the Financial Supervisory Commission withdraws a securities registration statement, it does not affect the fact that the person who has received an invitation to make an offer is more than 50 persons, apart from sanctions on non-performance of the obligation to report on the offering of securities, the restriction is against the principle of strict interpretation. Among the persons who participated in the offering of securities, the restriction is against the principle of strict interpretation by reducing non-taxation requirements. Since the number of investors exceeds 50 persons, whether the offering of securities is more than 50 persons, it constitutes non-taxation method in consideration of the series of process of capital increase issued from the resolution of the board of directors to the completion of the offering of securities.

(2) The Plaintiff’s benefit of donation is calculated pursuant to Article 29(3)1 of the Enforcement Decree of the Inheritance Tax and Gift Tax Act. The Defendant applied the assessed value per share prior to the capital increase under Article 63(1)1(a) of the Inheritance Tax and Gift Tax Act on August 14, 2007 pursuant to Article 52-2 subparag. 3 of the Enforcement Decree of the same Act. However, the instant company determined the issue value at the time of capital increase pursuant to the “Regulations on Issuance and Public Notice of Securities” (amended by Notice No. 2008-8 of Apr. 7, 2008; hereinafter “securities provision”) on the ground that the Plaintiff’s benefit of donation is calculated pursuant to Article 29(3)1 of the Enforcement Decree of the Inheritance Tax and Gift Tax Act. In addition, the instant capital increase is not a motive for normal and reasonable transaction and allocation of profits among non-specially related persons; the company cannot adjust the price of new shares if the tax authority determines the price of new shares to taxation, and there is no special possibility to consider whether the amount to allocate the amount of shares.

(3) The new shares allocated to the Plaintiff with capital increase issued in the instant case was protected for one year. As such, the Plaintiff did not have any substantial profit at the time of disposal of the Plaintiff’s shares due to the decline in the company’s stock price due to the commencement of the investigation, search, and seizure by the previous prosecutor’s office on the instant company, the imposition of gift tax is contrary to the principle of substantial taxation.

B. Relevant statutes

Attached Form 3 is as listed in the "relevant Acts and subordinate statutes".

(c) Fact of recognition;

(1) The details and documents disclosed in the electronic disclosure system of the Financial Supervisory Service for capital increase with consideration by the instant company are as follows.

Date of Publication

List of Publication Documents

Number of Capital increase

Date of payment for shares;

Special Matters

may 3, 2007

Report on Major Management Matters

8,400,237

June 20, 2007

OOOCOs for increased capital

May 4, 2007

Correction Report (Report)

8,461,596

June 20, 2007

Increase in Number of Stocks

may 22, 2007

Correction Report (Report)

9,158,910

June 22, 2007

OOOCOs for increased capital

June 20, 2007

Securities Statement

9,158,910

July 5, 2007

Submission of Financial Supervisory Commission

July 6, 2007

Securities Statement

Correction Statement

9,158,910

July 16, 2007

August 1, 2007

Written Withdrawal Statement

(2) On August 1, 2007, the instant company submitted to the Financial Supervisory Commission a withdrawal statement stating that “The Company held a board of directors on August 8, 2007 and decided to accept the entire number of shares allocated to the Korea Securities Depository for one year in relation to the decision to issue new shares for capital increase as publicly announced. Accordingly, it shall withdraw the submission of a securities registration statement.”

(3) The details of the third party allocation method attached at this time state that “the number of persons allocated” shall be 52 persons, but the formerB, the JJ, the former JJ, the KK, the specially related parties, the former LL, the formerM, and the NN shall be excluded from the number of allotted persons.

(4) On September 24, 2008, the Supreme Prosecutors' Office stated that leapP, which participated in the issue of new shares increase and received shares allocated, was as follows.

From May 2007 to August 2, 2007, the instant company was in charge of the business of offering new shares to the company. The executives and employees of the instant company held a small number of meetings (three to ten meetings) to invite investors in the process of raising investors. In addition, during the above period, the list of participants in offering new shares to the company was revised several times, and every time a new investor was sought.

(6) The details of the publication on the par value division of the shares of the instant company are as follows.

○ The period for submitting old stock certificates: June 30, 2007 to July 30, 2007

○ Period of suspension of trading: From July 27, 2007 to the day before the date of change of stock certificates

○ Transfer Suspension Period: from August 1, 2007 to August 12, 2007

The scheduled date for listing new shares: August 14, 2007

(7) The following are the details of changes in the market price prior to the offering of new stocks.

Date of transaction

Market price (won)

Date of transaction

Market price (won)

July 26, 2007

OOO

From August 1, 2007

By August 13, 2007

OOO

July 27, 2007

OOO

OOO

July 30, 2007

OOO

August 14, 2007

OOO

July 31, 2007

OOO

August 16, 2007

OOO

* From August 1, 2007, the par value division was initiated and suspended in transactions, and the transaction was commenced on August 13, 2007 and on August 14, 2007.

(8) The share price of the instant company’s shares was formed at around one year after the date of the instant subscription for new shares, and around August 2008, it was urgent to make a public announcement of the start-up of prosecutorial investigation into BB around the date of the instant subscription for new shares, and was formed between the OOO members around August 27, 2008, which was the date of the cancellation of the subscription for new shares.

Facts without dispute over the basis of recognition, Gap evidence 1 through 13, Eul evidence 2 and 3, the purport of the whole pleadings

D. Determination

(1) Whether the grounds for exclusion from gift tax (the case of allocating to the public offering method of securities in accordance with Article 2(3) of the Securities and Exchange Act) fall under the grounds

(A) Article 39(1)1 of the Inheritance Tax and Gift Tax Act provides that no gift tax shall be levied on forfeited stocks that a stock-listed corporation or Association-registered corporation under the Securities and Exchange Act allocates forfeited stocks to a public offering method under Article 2(3) of the same Act. This is an exception to the issuance of new stocks, where a corporation allocates new stocks through a public offering procedure under the Securities and Exchange Act and other relevant Acts and subordinate statutes, and trades among many unspecified persons within the Korea Exchange or Association brokerage market, it is determined in the fair competition process, and it is difficult

Article 2 (3) of the Securities and Exchange Act provides that "public offering of new securities is to be made under the conditions as prescribed by the Presidential Decree" and Article 2-4 (1) of the Enforcement Decree of the Securities and Exchange Act provides that "not less than 50 persons who are invited to acquire new securities shall be invited to make public offering of new securities in accordance with Article 2 (3) of the Securities and Exchange Act" and Article 2 (4) of the Enforcement Decree of the Securities and Exchange Act provides that "no more than 50 persons shall be invited to make public offering of new securities" and "no more than 50 persons are to be invited to make public offering of new securities within 1 year from the date of issuance and no more than 50 persons are to be invited to make public offering of new securities, and an agent of the Financial Supervisory Commission shall submit to the Financial Supervisory Commission a report on the public offering of new or new securities that is made under Article 8 (1) of the Securities and Exchange Act unless an issuer of the new or outstanding securities has accepted such an offer."

(B) In light of the following: (a) the company’s return to the instant case; (b) the company’s withdrawal of the securities declaration; (c) the company appears to have abolished the method of public offering of new stocks under Article 2(3) of the Securities and Exchange Act; (d) there was no sanction on the grounds that it did not perform its duty to report on the subscription of new stocks; (b) the company’s offering of new stocks is possible to invite subscription through public offering only after submitting the securities declaration and accepting it by the Financial Supervisory Commission; (c) the company’s offering of new stocks cannot be deemed as an offering of new stocks under Article 2(3) of the Securities and Exchange Act; and (d) the Supreme Prosecutors’ Office of this case stated that “the company of this case was assigned only to a specific person with interest from the beginning, and only to a non-disclosure method,” and thus, the Plaintiff’s offering of new stocks constitutes “the so-called offering of new stocks to investors and investors with no more than 0,000 investors’ solicitation,” and thus, the Plaintiff’s offering of this case’s offering of new stocks cannot be seen.

(2) As to whether the issue price of new shares issued through the offering of new shares satisfies the market price, even if the issue price of the new shares that the Plaintiff received at the time of the offering of new shares is determined in accordance with the delegation of Article 192(1)1 of the Securities and Exchange Act and Article 84-25(1)1 of the Enforcement Decree of the same Act, Article 57(3) of the Securities and Exchange Regulations stipulating that the issue price of the newly issued shares shall be determined in accordance with the delegation of Article 192(1)1 of the same Act and Article 84-25(1)1 of the Enforcement Decree of the same Act, the above provision has certain limitations on the issue price of the newly issued shares to ensure fairness and transparency of the issuance of new shares, and thus, it cannot be deemed as “market price” under Article 39(1)1(a) of the Inheritance Tax and Gift Tax Act, since the issue price of the newly issued shares is different from the issue price of the newly issued shares to ensure fairness and transparency of the issuance of new shares.

(3) As to the assessment value per share

(A) Article 52(1)1(a) of the Inheritance Tax and Gift Tax Act provides that the method of appraisal of stocks of listed corporations shall be the average market price of securities from the date two months have elapsed before or after the evaluation base date to the date immediately before or after the date of the appraisal base date, and Article 52-2(2)2 of the Enforcement Decree of the same Act provides that, in cases where a cause such as capital increase or merger occurs during two months before or after the evaluation base date, it shall be based on the average amount of the period calculated under the conditions as prescribed by the Presidential Decree during two months before or after the evaluation base date, and where a cause such as capital increase or merger occurs after the evaluation base date, the average amount of the period shall be deemed the market price from the date two months have passed before the evaluation base date to the date before the date when the cause occurs.

In the event of a capital increase or merger after the appraisal base date, the assessment price of listed stocks should be calculated differently based on the appraisal base date, considering that there is a change in the stock price when new stocks are issued due to such reasons as capital increase or merger, the reason such as capital increase or merger has a significant impact on the formation of the future stock price.

(B) Return to the instant case and health class, ① “amount split” refers to the increase of the total number of outstanding shares by dividing the existing shares at a certain rate without any increase or decrease in capital. The par value split is conducted when the market price of a certain shares is so high that the transaction of shares is low or it is difficult to issue new shares. In such a case, the increase in the share price would substantially increase if the transaction of shares is low by lowering the par value per share price. In real case of the instant company, the price of shares immediately before the split value was an OO member, and the price of shares before and after the split value was increased by OO(OO member if the price after the split value is converted before and after the split). ② The proviso to Article 63(1)1 of the Inheritance Tax and Gift Tax Act is to promote a balance in the assessment of shares price, and it is reasonable to consider the above "the split or split value of shares" as well as the above "the total amount before and after the split value" as stated in the proviso to Article 63(1)1 of the Inheritance Tax and Gift Tax Act.

(C) Therefore, given that the instant capital increase was made after the occurrence of a cause for capital increase or merger, the appraised value per share prior to the capital increase shall be calculated by applying Article 52-2(2)3 of the Enforcement Decree of the Inheritance Tax and Gift Tax Act as the average amount from August 14, 2007, which is the first transaction day after the capital increase (the base date for appraisal under Article 29(4) of the Enforcement Decree of the Inheritance Tax and Gift Tax Act), which is the first transaction day after the capital increase or merger (the base date for appraisal under Article 29(4) of the Enforcement Decree of the Inheritance Tax and Gift Tax Act), until the day before the payment date for the capital increase. However, since the date prior to August 16, 207, which is the payment date for the capital increase, is a legal holiday (the date of August 15, 2007), the payment date prior to the payment date for the capital increase is ultimately the appraised value of the previous stock by an OO member, which is

(4) As to whether the subject matter of gift tax is not subject to gift tax, since there was no benefit in the actual disposal of shares after the lapse of the period of duty of safekeeping.

Even if the Plaintiff did not have any substantial profit at the time of disposal of the shares due to the decline in the company’s stock price due to the commencement of the investigation, seizure, and search of the company of this case for one year and the previous prosecutor’s office, Article 29(4) of the Enforcement Decree of the Inheritance Tax and Gift Tax Act provides that ① calculation of profit under the provision of paragraph (3) of this Article shall be based on the payment date of the shares; ② an underwriter of new shares has the right and duty of shareholders as of the day immediately following the due date of payment of the shares, and the Plaintiff acquired the shares at the time of payment of the shares. ③ Even if the Plaintiff’s rights to receive dividends as shareholders and the right to receive residual assets at the time of liquidation, this is merely limited to the existing disposal of new shares under an agreement between the Plaintiff and the company of this case, and the effect of acquisition of new shares is that the acquisition price of new shares was generated, ④ The acquisition price of new shares cannot be considered as the decrease in the market price of the shares due to the decrease in the sale price of the shares.

(5) Sub-committee

Therefore, the instant capital increase with new stocks issued at a price lower than that of the pre-capital invested won, which is the value of the pre-capital invested, and does not constitute the case of allocating new stocks by means of securities offering under Article 2(3) of the Securities and Exchange Act, which is the grounds for exclusion from gift tax. Therefore, the instant disposition that is imposed on the gift tax calculated and imposed pursuant to Article 39(1)1 of the Inheritance Tax and Gift Tax Act and Article 29(3) of the Enforcement Decree of the same

3. Conclusion

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