HM Revenue and Customs (HMRC) has been left red-faced after its move to appoint a management receiver for mobile phone trader Unique Distribution’s parent company, IGB, was reversed by a High Court judge.

An agent of HMRC took control of IGB on 18 January as part of its VAT carousel fraud crackdown. However, a High Court judge last week discharged the freeze order, concluding there was insufficient evidence to justify the move.

David Hinc, head of managed services at Unique, said it was inevitable that IGB would now take action against HMRC.

“This has severely affected IGB’s operational capabilities, although other parts of its business were more affected than us,” said Hinc.

According to sources close to the events, the HMRC agent had planned to sell Unique and other parts of IGB. One distribution source said: “The HMRC receiver approached us and gave us a deadline of 15 February to bid for Unique, which was too short notice for us.”

Anthony Elliot-Square, director of industry body the Federation of Technological Industries, said: “One hopes that HMRC will take note of this and start abiding by the law.

It is over-extending its powers in

the grey market, which is forcing companies to take it to court and has caused many companies to go into administration.”

A representative from the Revenue and Customs Prosecutions Office (RCPO), said: “The RCPO does not take decisions to apply for management receivership orders lightly and we understand that there is still a restraint order in place, which IGB has not mentioned [in its press release].”