The UK court has banned two Indian origin restaurant owners from the formation, promotion, or management of a company without the permission of the court over tax evasion, which caused the United Kingdom tax department losses of more than 4 million pounds.
The 55-year-old Sukdev Gill admitted that he caused companies he was a director of to conceal Value Added Tax (VAT) over six years, which resulted in a loss to the Her Majesty’s Revenue and Customs (HMRC) of 1.97 million pounds.
As a penalty, Gill signed a ‘disqualification undertaking’ with the UK’s Insolvency Service for eight years.
Gill’s business partner, 47-year-old Inderjit Singh, was disqualified for nine years after he also did not dispute that he traded through successor companies while also concealing VAT resulting in a loss of 4.37 million pounds to HMRC.
Accordingly, the two businessmen are prohibited from setting up or running any business without legal approval.
Robert Clarke, the Chief Investigator for the Insolvency Service said Sukdev Gill and Inderjit Singh have received substantial bans, which will significantly curtail their activities.
He added that this should serve as a clear warning to others that if you fail to observe your statutory duties as company directors then the penalties are severe.
Concealing and failing to pay tax on a grand scale like this was not an administrative error. The two directors knew exactly what they were doing and not only did the exchequer lose out, but their businesses gained an unfair advantage over their competitors.
Gill and Singh served as directors of five companies incorporated between 2012 and 2012 – Coin De Indes Buffet Limited, Experience India Limited, Salut E Hind, Seeye Diamonds and Hot Flame World Buffett trading as licensed restaurants in or around the Glasgow area of Scotland.
The five companies were ceased to exist by March 2018, with each one entering into a form of insolvency, either through compulsory liquidation or Creditors Voluntary Liquidation.
According to the Insolvency Service, HMRC made post-liquidation inquiries into the companies before demonstrating that all five had taken part in some form of tax misconduct, including under-declaring tax, failing to register for VAT and concealing tax owed.
Since the cease of companies, Singh proceeded to incorporate successor companies, all of which traded as ‘Cook and Indi World Buffet’ to continue the activities of the five companies that had gone through insolvency.
However, each of the 14 companies fell victim to the same fate as their predecessors and entered into a form of insolvency. Upon looking at the companies’ activities following their liquidation, HMRC discovered that Singh allowed the buffet restaurant businesses to conceal millions of unpaid tax from HMRC.
The new companies too concealed VAT and under-declared tax contributions and concurrently failed to send word to HMRC that new businesses were continuing the work of previous companies.
