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One of Manchester’s biggest Indian restaurants put up for sale after owners fall out

Royal Nawaab has been at the centre of a protracted court dispute, according to a recently-published High Court document.

The Manc - 7th June 2021

One of Manchester’s biggest and most popular Indian restaurants is set to go on sale following a fallout between the owners.

Royal Nawaab – a buffet restaurant and banqueting hall on Stockport Road in Levenshulme – has been a hotspot for Asian cuisine, casual dining and pre-COVID large-scale events since it opened on the site of a former cinema back in 2003.

However, the restaurant has been at the centre of a legal dispute in recent weeks, according to a recently-published High Court document.

The High Court noted that the business has been “very profitable” during its run, but the founders, Tariq Mahmood Malik and Mahboob Hussain Junior, had fallen out within a few years of opening up.

Now, after years of bad blood between the founders, the judge has ruled that the property and 50% of the company must go on sale in a process bounded by terms set by the court.

At the High Court hearing at Manchester Civil Justice Centre last month, Judge Stephen Davies explained that Tariq and Mahboob had begun as joint owners and shareholders in the business – but by 2007, Tariq stepped back from the business as his relationship with Mahboob soured. His son Asad – who is married to Mahboob’s daughter, Atikah – took the reins.

Over time, Tariq’s wife, Nusrat Tariq, and Mahboob’s wife, Mirza Begum, also became shareholders in the business. However, in 2016, Tariq fell out with members of his own family – including his wife Nusrat, with whom he was by then estranged, as well as his son Asad, and another, younger son, Usman, who by then were both shareholders in the business and were supportive of their mother.

As a result of this fallout – which Judge Stephen Davies said “appeared to be irreversible” – Tariq was removed as a director.

With the future of the business left hanging in the balance, the judge stated that the “most sensible way forward” was to have an expert valuation on the restaurant premises so that Tariq’s interests and partnership assets could be sold – but Tariq then said that he wanted the Stockport Road property sold on the open market.

Then, in an unexpected turn of events, Tariq offered to buy out Mahboob for £2.2 million back in March, but this was rejected by Mahboob’s lawyers who said said it was “unacceptable” for any third party to acquire Mahboob’s share.

The lawyers also said that they didn’t think it was a genuine offer “since Tariq had no obvious means of funding the purchase”.

With Tariq pressing for the business to be sold off, and Mahboob still wanting to buy Tariq out, Judge Stephen Davies decided on the compromise that the property should be sold according to the court’s terms, and that if no sale proceeds Mahboob should buy out Tariq.

Judge Davies ordered a “full and fair” valuation of the property and the business so that Tariq, Mahboob and any of the other defendants can make bids “as should any third party who wishes to do so”, adding however that any “independent” selling agent or solicitor charged with the “conduct of the sale” should be under “no obligation to publicise” it.

In order to “prevent injustice”, the judge set terms that mean Mahboob can acquire the property and the shares at the court’s valuation if others drop out after making bids above that price.

“The court has a discretion not only as to whether or not to order a sale, but also the manner in which any sale should be conducted,” Judge Davies said.

“That is particularly important in this case, since in my judgement there is a very real likelihood that Tariq’s true motive in pressing for an order for sale is to attempt to increase the price by engineering a bidding war, and I am satisfied that it is necessary to ensure that the provisions in relation to any sale should be tailored so far as reasonable to prevent him from doing so with impunity.”

Featured Image – Royal Nawaab