Two directors of companies in the Masala restaurant group have been found in contempt of court and fined after they failed to deliver documents to liquidators.

A string of companies associated with the Indian food chain have been wound up, with creditors claiming hundreds of thousands of dollars.

The firms' liquidators, Damien Grant and Steven Khov, ran into difficulties getting documents from the directors of four companies in the group.

They 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.

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Although such orders were made last July, the liquidators took the view that the four directors had not complied with them and wanted a High Court judge to hold the quartet in contempt.

While both sides reached an agreement to ensure the liquidators got the relevant documents, a contempt hearing still took place earlier this month.

In the case of Grewal, he told the liquidators in February that he had 97 boxes of documents they could uplift from his Royal Oak home and delivered further boxes and computer hard drives when he went to their offices later that month.

Grewal argued he never willfully refused to comply with the court orders but had difficulties in doing so because he was serving home detention after admitting worker exploitation charges.

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.

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Grewal also pointed out that police took documents when executing a search warrant in December and still had them.

Justice Heath, in his decision this week, said Grewal ought to have delivered the documents to the liquidators after the order was made last July.

"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," the judge said.

In respect of 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.

"I dismiss the application that she be held in contempt, but make no orders as to costs in her favour," Justice Heath said.

Jain also denied she willfully refused or failed to comply with the court order.
Justice Heath, however, took a different view:

"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."

Jain was fined $5000.

Half of the fines which Jain and Grewal were ordered to pay will go to the Crown, while the rest will go the liquidators.

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

A judge said late last year that Jain and Grewal were key persons of interest in an Inland Revenue probe.

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

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