Restaurant boss banned from holding directorships for 8 years for suppressing takings
The director of a Brick Lane Indian restaurant has been disqualified from acting as a company director for eight years for failing to provide proper accounting records for his company.
Mr MD Taj Uddin, 37, was the a director of Spice of Sylhet Limited which traded as as Papadoms.
Mr Uddin has provided an undertaking to the Secretary of State for Business, Energy and Industrial Strategy preventing him from being a director of a company whether directly or indirectly, or be involved in the management of a company in any way for the duration of his disqualification unless he has permission from Court.
The disqualification follows an investigation by the Insolvency Service which found Mr Uddin also deliberately failed to ensure that Spice of Sylhet Limited had properly and accurately accounted for VAT to HMRC.
Without proper accounting records, it was not possible in particular to verify the true level of takings, reasons for payments of £265,418 including cash withdrawals of £27,827 from the company bank account during the periods November 2013 to April 2015.
The fact that no wage records were produced meant it was not possible to establish the number of staff employed, level of wages paid and the amounts of tax & National Insurance contributions due.
At liquidation, the company owed in excess of £199,000 to HMRC in relation to arrears of VAT, PAYE and National Insurance contributions. Mr Uddin, however, had disclosed in the Statement of Affairs that the debt to HMRC was £21,434.
An HMRC investigation revealed that during the period of trading, the restaurant takings had been deliberately concealed. HMRC notified Mr Uddin of this and assessed the level of concealment as £78,128 VAT and also imposed Civil Penalties of £73,113.
Commenting on the disqualification, David Brooks a Chief Investigator with the Insolvency Service said:
The period of this disqualification contained within the undertaking signed by Mr Uddin sends a clear message to other company directors that: If you fail to comply with statutory legislation because you do not maintain sufficient company accounting records to satisfactorily explain payments and transactions of the business or your company records conceal the true level of takings and sales this will not be tolerated.
Much of the public service is funded by the correct amount of taxes being paid. By not declaring and paying the correct amount of taxes, Mr Uddin has ultimately deprived the public services and the public from receiving the services it deserves. The Insolvency Service therefore will not hesitate to remove them from the business environment in order to protect the public.
Notes to editors
MD Taj Uddin, 37, was a director of Spice of Sylhet Limited (CRO No. 08683579) which was incorporated in September 2013.
MD Taj Uddin has been disqualified for a period of 8 years commencing from 2 January 2017. His date of birth is 25 January 1979.
One of the main purposes of the Company Directors Disqualification Act is to ensure that proper standards of conduct of company directors are maintained and to raise those standards where appropriate.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings. Persons subject to a disqualification order are bound by a range of other restrictions.
The Insolvency Service, an executive agency sponsored by the Department for Business, Energy and Industrial Strategy (BEIS), administers the insolvency regime, and aims to deliver and promote a range of investigation and enforcement activities both civil and criminal in nature, to support fair and open markets. We do this by effectively enforcing the statutory company and insolvency regimes, maintaining public confidence in those regimes and reducing the harm caused to victims of fraudulent activity and to the business community, including dealing with the disqualification of directors in corporate failures.
BEIS’ mission is to build a dynamic and competitive UK economy that works for all, in particular by creating the conditions for business success and promoting an open global economy. The Criminal Investigations and Prosecutions team contributes to this aim by taking action to deter fraud and to regulate the market. They investigate and prosecute a range of offences, primarily relating to personal or company insolvencies.
The agency also authorises and regulates the insolvency profession, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
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Published: 4 January 2017
From: The Insolvency Service