On 30th May 2012 Lord Justice Patten handed down judgment in QEB Metallics Ltd (in liquidation) v. Peerzada and others, heard by the Court of Appeal for a 3rd failed attempt by a Defendant, Mr. Hafiz, to overturn judgment in which he was declared a shadow director of the QEB Metallics and liable to pay £2.14 million equitable compensation to its liquidator for his fraudulent management.
Rupert Butler acted for the liquidator throughout the action, starting with an application for provisional liquidation, obtaining freezing orders directors, pursuing them to trial and responding to appeals, in a claim under ss.212 and 213 of the Insolvency Act 1986, following the company’s attack on the VAT system by the importation of impure platinum for smelting and onward sale.
The final grounds of appeal argued that the declarations accepted by HMRC as the imported platinum passed through Customs, meant the tax point for the companies’ transactions was created in Dubai and should have been zero-rated for VAT, even though the refinery paid QEB Metallics output tax at the UK’s rate by mistake. Mr. Hafiz claimed that if the trial Judge had been made aware he would have come to a different conclusion on liability. However, the Court of Appeal accepted the liquidator’s argument that Mr. Hafiz would be liable to the contributories of the company in any event as he could not account for the sum of £2.14 million, which had been received by QEB Metallics from the refinery and gone missing while he was in charge.
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February 17, 2021