Shinya Japanese Food Producing Pty Ltd liquidated, accused of insolvent trading
Already facing an upcoming legal battle over alleged wage theft, a Geelong restaurateur is now scrambling to pay off his company’s debts.
A company run by the owner of a failed Geelong restaurant chain has been accused of trading while insolvent and having debts of more than $130,000 despite claims it “never opened”.
Shinya Japanese Food Producing Pty Ltd was plunged into liquidation in April this year after being ordered to wind up by the Federal Court.
Now, a report lodged with the Australian Securities and Investments Commission estimates the company owes more than $133,000 to the Australian Taxation Office and its Mercer St landlord.
Shinya Japanese Food Producing is part of sole director Bryan Mu’s broader Shinya Ramen group, which ran stores in Geelong, Waurn Ponds, and Torquay that have since closed.
Mr Mu said he had envisioned the business as a “central kitchen” that would make and supply food to his four locations.
However, a costly renovation process and the restaurant chain’s collapse dried up all available funds and resulted in the landlord kicking Mr Mu out.
In the report, liquidator Mathew Blum of BDO concluded the business had been operating despite not being able to pay off the significant debt.
“I consider that the director has allowed the company to trade while insolvent … I will be sending a demand to the director outlining the details of the insolvent trading claim,” Mr Blum said.
However, Mr Mu insists the business “never traded”.
“It was a nearly one-and-half year project but we couldn’t open … this was a failed but un-traded business,” he said.
The ATO lodged a proof of debt for nearly $70,000 for unpaid tax liabilities while the landlord, represented by boutique real estate agency Darcy Jarman, claimed they were owed $63,000 for outstanding lease payments.
Mr Blum said the poor handling of the business’ affairs was to blame for the large debt.
“Based on my investigations to date, the company’s failure can be attributed to poor strategic management, including ineffective operational oversight … financial mismanagement was also evident, with insufficient control of increasing debts and an inability to meet statutory obligations,” he said.
“The company shares a common director, Mr Tao Mu, with Shinya Restaurant Group Pty. Ltd. (In Liquidation), a previously failed entity, raising concerns about governance and management.”
Shinya Restaurant Group, trading as Golden Dragon Yum Cha on Moorabool St and run by Mr Mu, was found to owe more than $500,000 to creditors in 2023.
And just last month, the Fair Work Ombudsman launched legal action against Mr Mu’s restaurant entity for alleged wage theft.
If found guilty, Mr Mu will personally have to cough up almost $10,000 while his companies Shinya Geelong HR Pty Ltd and Shinya Torquay HR Pty Ltd could be slapped with up to $46,950 each in fines and made to rectify the combined $9,195.68 allegedly owed to the workers.
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Originally published as Shinya Japanese Food Producing Pty Ltd liquidated, accused of insolvent trading
