MICHAELA JOY HALL v DEEPAK BHATIA

MICHAELA JOY HALL v DEEPAK BHATIA

The Respondent, as sole director, had actual knowledge of MTIC VAT fraud, failed to carry out genuine due diligence, and dishonestly caused the Company to participate in fraudulent trading. He is liable under Insolvency Act 1986 s.213 and s.212 for fraudulent trading and breach of fiduciary duty. Losses include input VAT paid to suppliers less profits, plus misdeclaration penalty.

Parties
Applicant Liquidator: Michaela Joy Hall; Company: JD Group Limited; Respondent: Deepak Bhatia
Jurisdiction
England and Wales
Judgment Date
03 February 2022
Procedural Posture
Civil Insolvency / Judgment After Trial
Outcome
Claim allowed; Respondent found liable for fraudulent trading and breach of fiduciary duty.
Legal Topics
Fraudulent Trading, Breach of Fiduciary Duty, MTIC VAT Fraud, Director Liability, Misfeasance, Limitation, Loss Quantification
Insolvency Company Law Fraud Fraudulent Trading Breach of Fiduciary Duty MTIC VAT Fraud Director Liability Misfeasance +2 more

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Parties

Michaela Joy Hall

Applicant Liquidator

JD Group Limited

Company

Deepak Bhatia

Respondent

Procedural Posture

Civil Insolvency / Judgment After Trial

Legal Issues

  1. 1 Whether Respondent dishonestly caused JD Group Limited to participate in MTIC VAT fraud
  2. 2 Whether Respondent breached fiduciary duty under Insolvency Act 1986 s.212
  3. 3 Whether Respondent is liable for fraudulent trading under Insolvency Act 1986 s.213

Ratio Decidendi

The Respondent, as sole director, had actual knowledge of MTIC VAT fraud, failed to carry out genuine due diligence, and dishonestly caused the Company to participate in fraudulent trading. He is liable under Insolvency Act 1986 s.213 and s.212 for fraudulent trading and breach of fiduciary duty. Losses include input VAT paid to suppliers less profits, plus misdeclaration penalty.

Court Disposition

Claim allowed; Respondent found liable for fraudulent trading and breach of fiduciary duty.

Orders

  • Respondent to pay £1,785,892 to the Liquidator (input VAT paid to suppliers less profits plus misdeclaration penalty).
  • Interest to be determined after judgment.