Whether a non-designated advertising agency is a designated donation under Article 18(1) of the Corporate Tax Act and Article 40(1) of the Enforcement Decree of the Corporate Tax Act and Article 40(1) of the Enforcement Decree.

Before the enforcement of the Korea Broadcasting Advertising Corporation Act, the manufacturer and sales company of electronic equipment has entered into an advertising agency contract with Eul and paid agency fees for advertising production and its advertising activities. The advertisement requires high level of professional planning and technology and it is directly related to corporate profits. Thus, even after the Korea Advertising Corporation Act enters into force, it was difficult for the Korea Broadcasting Advertising Corporation to select a so-called designated agency company selected by the Korea Broadcasting Corporation as an advertising agency of Gap company. In addition, if the total expenses paid to the domestic broadcast advertisement of Eul company, including the advertising agency fees paid to non-designated agency, are significantly higher than the total expenses paid to the domestic broadcast advertisement of Eul company, the total expenses paid to the domestic broadcast advertisement of Eul company, including the advertising agency fees paid to the non-designated agency company, is not recognized as more than the total expenses paid to the domestic broadcast advertisement, the company Gap is designated as an agency agency of non-designated advertising agency of Eul company, and the advertising fees paid for the advertisement, which shall not be deemed as the expenses for the designation of the agency under Article 18(1)1 of the Corporate Tax Act.

Article 18(1) of the Corporate Tax Act; Article 40(1) of the Enforcement Decree of the Corporate Tax Act

[Defendant-Appellee] Kim Jong-gu, Counsel for defendant-appellee

The director of the tax office

Seoul High Court Decision 85Gu859 delivered on February 9, 1987

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

According to Article 15 of the Korea Broadcasting Advertising Corporation Act, effective January 1, 1981, domestic broadcasting stations shall not broadcast advertising other than advertising fees entrusted by the Korea Broadcasting Advertising Corporation (hereinafter referred to as the "Korea Broadcasting Advertising Corporation"), and Article 5 of the said Act provides that if a domestic advertising agency entrusts its broadcast advertising business to the Korea Broadcasting Advertising Corporation, only the designated advertising agency selected by the said Corporation shall pay the amount equivalent to 5 to 8% of the advertising fees as an advertising agency. Therefore, barring special circumstances, it is pointed out that the plaintiff might be exempted from the burden of paying the advertising agency fees in addition to the advertising fees if he/she requests the advertising service separately if he/she requested it through the designated agency selected by the Advertising Corporation.

However, according to the facts duly established by the court below's adopted evidence, the plaintiff entered into an advertising agency contract with the non-party 1 corporation, a specialized advertising company prior to the enforcement of the Korea Broadcasting Advertising Corporation Act (hereinafter the "ScarP"), which is the non-party 1's specialized advertising company prior to the enforcement of the Korea Broadcasting Advertising Corporation Act, and had it act as an advertising agency for the plaintiff, and pay 8% of the advertising fees as an advertising agency. The plaintiff's electronic equipment, etc. manufactured and sold by the plaintiff company need to be advanced technology as of the day and deepen competition, and its advertising method also requires a high level of planning and technology for the advertisement, and such advertising is directly connected with the company's profits, so it is difficult for the plaintiff company to select the non-party 1's advertising company as an advertising agency without any reasonable trust, and even after the enforcement of the Korea Advertising Corporation Act, it is now difficult for the plaintiff company to act as an advertising agency for the plaintiff 1's designated company's own interest in the domestic advertising industry.

In this regard, the court below is just in holding that the defendant's taxation disposition on this case, which was imposed by the plaintiff on the non-party scarcity industry, cannot be seen as a "non-designated donation" and the defendant's taxation on this case was unlawful because it is not a "non-designated donation", and there is no error of law by misunderstanding the legal principles under Article 18 (1) of the Corporate Tax Act and Article 40 (1) of the Enforcement Decree of the Corporate Tax Act, and there is no error of law by misunderstanding the rules of evidence such as the theory of lawsuit or incomplete hearing in the process of fact-finding by examining the

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Lee Jin-Post (Presiding Justice)