Masala restaurant chain boss jailed for tax evasion
The disgraced boss of an Indian restaurant chain and his accountant have been sentenced on tax evasion and money laundering charges.
Rupinder Singh Chahil, a New Zealand citizen who started the Masala chain, admitted 34 charges relating to tax evasion and nine charges of money laundering on the second day of his trial at the High Court in Auckland last year.
Accountant Vijay Kumar Gupta, 65, also pleaded guilty to nine charges of money laundering.
Yesterday, Justice Ian Gault sentenced the pair at the High Court at Auckland. Chahil was sentenced to three years and two months of imprisonment and was ordered to pay $50,000. Gupta was sentenced to 10 months of home detention and ordered to pay $5000.
At the sentencing, Crown prosecutor Brian Dickey sought imprisonment for both defendants and for them to be fined. He said the offending was evasion of GST on a grand scale and was widespread.
Dickey said a $5000 fine for a high street restaurant business would ‘‘not be a stern deterrent to the next one’’.
He accepted a discount could be given to Gupta for his previous good character, whereas Chahil could not given his history.
Chahil’s lawyer, Tony Bamford, said his client had arranged for the tax to be paid.
Bamford submitted Chahil should be sentenced to a term of home detention or community work. ‘‘This man does not need to receive a prison term, he is a contributor to the community ... he is remorseful.’’
Gupta, an accountant and justice of peace, did not hold a public practising certificate but knew Chahil from community and business associations. John Billington QC, acting on behalf of Gupta, said his client had contributed monumentally to the New Zealand community.
In offending, Gupta had disgraced himself and his family, which was punishment in itself, Billington said.
In sentencing Chahil, Justice Gault said the man was involved in a ‘‘large scale’’ and ‘‘sophisticated’’ tax evasion scheme. Between 2008 and 2014, both men concealed cash sales from the Masala restaurants and then failed to file tax returns from 17 companies. Chahil filed 115 returns to IRD which contained false or misleading information and totalled a loss of more than $700,000, Justice Gault said.
The judge said the offending happened over an extended period of six years and was sustained and repetitive. Justice Gault said that while most of the loss had been recouped in a settlement, Chahil’s culpability was not reduced. ‘‘You would not have returned the money had you not been caught.’’
While Gupta’s role in the scheme was much lesser, Justice Gault said it was still serious as he used his skills to enable the offending.
This is not the first time Chahil has been before the courts. In 2010 Chahil was jailed for 18 months for kidnapping chefs who worked at his Curry and Spice Restaurant in 2007.
Akbar and Bashan Singh quit their jobs at the Whangaparaoa restaurant because they were unhappy with their wages. The same night, six to eight people, including Chahil, arrived unannounced at their home, assaulted them and held them captive for several hours.
In 2016, Chahil was also sentenced to six months of home detention and ordered to pay $2500 reparation for exploiting migrant workers. An investigation by Immigration NZ found Masala workers were paid as little as $3 an hour, made to clean the owners’ homes, forced to under-record the hours they worked and to return some of their pay to their employer.
Earlier this month, Joti Jain, who was a former co-owner of the companies running the chain, abandoned her appeal for permanent name suppression after she was sentenced to nine months of home detention on 21 charges of tax evasion in 2018.
In 2015, Jain was sentenced to 11 months of home detention, 220 hours of community work and ordered to pay $58,000 in reparations after admitting a raft of immigration and exploitation charges.
In 2017, three properties associated with the Masala chain netted almost $8 million at auction after being seized as part of a $34m restraining order granted over more than 30 properties linked to the chain back in 2015.