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  • Writer's pictureNEMM

Brothers banned after concealing restaurant earnings

Abul Azad (57), Abul Ashraf (50), and Abul Khaled (44) have been banned from acting as company directors for 7 years, 7 years, and 3-and-a-half years respectively.

The three brothers, all from Melton Mowbray, were directors of A & A (Melton Mowbray) Limited and shared the running of the Apurba, Bombay Brasserie and Tandoori Knights Indian restaurants.

However, they deliberately or recklessly destroyed or removed sales records in their company accounts in order to avoid paying the full VAT and corporation tax amounts that were due.

In total, £566,749 was owing to HMRC when the brothers placed the company into liquidation.

Throughout the Insolvency Service investigation, the brothers sought to discredit and place blame on the company’s accountant, despite receiving written warnings from the accountant in successive years that the company had inadequate record keeping processes in place and that it was obvious that cash and sales records were going missing.

In some cases, sales identified solely through card payment data was found to be more than their total reported sales, which also included cash payments.

£566,749 was owing to HMRC when the brothers placed the company into liquidation. Photo: File Pic.

Abul Azad and Abul Ashraf signed disqualification undertakings accepting that they caused or allowed the company to suppress its sales over a period of at least 4-and-a-half years, to the detriment of HMRC. Their bans begin on 6 July 2021 and last for 7 years.

Abul Khaled, who was only a director of the company for a short time during the period, admitted to causing or allowing the company to suppress its sales over a period of at least 8 months. His ban of 3-and-a-half years also begins on 6 July 2021.

Azad and Ashraf were the longest serving directors, having been in post since the company was incorporated on 6 May 2010. Abul Khaled was in office from 1 November 2015 to 1 July 2017.

Cassandra Dowthwaite, Deputy Head of Insolvent Investigations (North) at the Insolvency Service, said: "This ban should serve as a warning to other directors tempted to conceal sales and withhold taxes, which are needed to fund vital public services, for their own benefit. Companies have limited liability, which is a privilege, not a right, and The Insolvency Service have strong enforcement powers which we will not hesitate to use to remove that privilege from dishonest or reckless directors."

A & A (Melton Mowbray) Ltd (company number 07246095) went into Creditor Voluntary Liquidation on 15 August 2018. Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.

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