Seven-year ban for clothing firm director
THE owner of a Manchester clothing wholesaler has been banned from holding directorships for seven years after failing to keep proper accounting records.
Bhupinder Singh, the director of Cheetham Hill-based MMC Direct, gave an undertaking to the Secretary of State for Business, Innovation and Skills not to act as a director or in any way manage or control a company until January 29, 2021.
The Insolvency Service said Singh did not dispute that the company did not maintain, preserve or deliver adequate accounting records.
As a result it was not possible to reconcile differences between the income and expenditure shown in the company’s bank statements and that shown on the VAT returns.
The records also failed to show what had happened to £407,320 drawn from the bank account in cash. Due to the poor record keeping HM Revenue & Customs did not believe that sales of £886,686 within the European Union were legitimately VAT-free and instead raised a bill for £132,718, which has not been paid.
Robert Clarke, head of insolvent investigations North at the Insolvency Service, said: “Companies that trade with limited liability are required by law to keep accurate books and records to account for their transactions.
“When a company claims to have exported goods within the European Union, enabling it to reclaim VAT, it must provide clear evidence of the transactions. Failure to do so means that it is impossible to determine whether supplies have legitimately been made or an attempt is being made to deceive the taxman, and in those circumstances the Insolvency Service will investigate and look to remove the directors concerned from the business arena.”
