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Indian restaurant’s directors fined for contempt of court

Masala Indian restaurant Source: Facebook

The 2 directors – Rajwinder Grewal and Joti Jain – have been fined after they failed to deliver documents to liquidators.

The 2 directors of companies in the Indian restaurant group – Masala – have been found in contempt of court.

The 2 directors – Rajwinder Grewal and Joti Jain – have been fined after they failed to deliver documents to liquidators.

Damien Grant and Steven Khov, the firms' liquidators, ran into difficulties getting documents from the directors Masala group.

Grant and Khov went to the High Court to get orders requiring directors of the various firms – Rajwinder Grewal, Satwant Singh, Ravinder Kaur and Joti Jain – to provide them with records.

A string of companies associated with Masala food chain have also been wound up.

NZ Herald reports that the Inland Revenue alleged that 17 companies that owned Masala restaurants under-reported earnings to evade paying more than $7.4 million of tax.

The creditors are claiming hundreds of thousands of dollars from Masala group.

Grant and Khov took the view that the 4 directors had not complied with them and wanted a High Court judge to hold the quartet in contempt.

While both sides reached an agreement a contempt hearing still took place earlier this month.

Grewal told the liquidators in February that he had 97 boxes of documents and also delivered further boxes plus computer hard drives to their offices.

Grewal was serving home detention after admitting worker exploitation charges.

NZ Herald reports that Justice Heath said “I am satisfied beyond reasonable doubt that Mr Grewal deliberately decided either not to comply with the order, or to delay, in order to frustrate the liquidators in the exercise of their statutory duties.”

Justice Heath, in his decision this week, noted - "His sentence of home detention is not relevant to that obligation as it did not commence until 18 October 2015. Nor does the excuse offered about documents being seized by the Inland Revenue Department or the Police, because at least some of the relevant documents had been delivered back to Mr Grewal between July 2015 and January 2016. I am satisfied beyond reasonable doubt that Mr Grewal deliberately decided either not to comply with the order, or to delay, in order to frustrate the liquidators in the exercise of their statutory duties. I consider that Mr Grewal's conduct represents the most serious of the breaches of the orders ... find him in contempt of court and order that he pay a fine of $10,000."

In respect of Ravinder Kaur, Justice Heath said it could be argued she was technically in default of the orders but he did not consider she had intended to flout them deliberately.

In case of Joti Jain Justice Heath said - "Ms Jain deliberately failed to disclose to the liquidators the existence of documents held electronically on her personal email account, or to take steps to have them delivered up. I do not accept that Ms Jain believed that documentation did not come within the scope of the order. Such a suggestion is implausible in the circumstances."

Joti Jain was fined $5000.

Joti Jain was sentenced to 11 months' home detention in October 2015 after admitting immigration and exploitation charges in connection with the under-payment of staff.

The fines which Jain and Grewal were ordered to pay will go to the Crown and the liquidators.

The Masala directors were also ordered to pay $20,000 in costs.

The contempt application against Satwant Singh will be argued later this month.

 

Source NZ Herald