Directors of a Birmingham supermarket have been disqualified for failing to pay thousands in business rates after submitting false information to the council.
Pak Supermarket Washwood Heath Ltd, known as Pak Supermarket, was incorporated on 3 August 2010 and operated in Washwood Heath, Birmingham.
However, the company went into Creditor’s Voluntary Liquidation in January 2015 with an estimated deficiency of more than £2.8 million.
Following the company’s liquidation, an investigation by the Insolvency Service found that the company had provided misleading information to Birmingham City Council as to the identity and potential liability of the occupants of the supermarket between August 2010 and 13 October 2014.
Over the four years of trading, the company submitted to the council documents relating to eight third-party companies, suggesting these eight companies were, at separate times, the occupants responsible for business rates. As a result, this information hid that the fact that the true occupant was Pak Supermarket and it was the supermarket that was liable to pay business rates.
Prepared accounts and bank analysis showed a turnover for the company in excess of £35million and the company only made a single payment of £5,000 towards a business rates bill of at least £680,000.
Investigators then spoke to Mohammed Younis as he was the sole appointed director of Pak Supermarket between August 2010 and January 2014.
However, he told investigators from the Insolvency Service that from November 2010 he took no part in the management of the company and left it under the control of Zahir Rasul, who was only formally appointed on 15 January 2014.
The Secretary of State for Business, Energy & Industrial Strategy has since accepted disqualification undertakings of eight years from Zahir Rasul and three years from Mohammed Younis, effective from 10 April and 3 May respectively.
This means that they cannot be directors of a company whether directly or indirectly, or be involved in the management of a company in any way for the duration of their disqualifications.
Martin Gitner, Deputy Head of Investigations at the Insolvency Service, said:
Directors have a duty to provide their local council with complete and accurate information with regard to the occupants of trading premises in order to ensure that liability is properly attributed.
Where information provided is found to be false and/or misleading, resulting in a loss of funds to the Council, directors can expect to be investigated by the Insolvency Service and enforcement action taken to remove them from the market place.
