The owner of the now defunct Mambra electronics store yesterday lost a battle to save his villa in Santa Maria Estate from being held as collateral against his tax debts even though he has not lost the war yet.

Joseph Pavia had asked the court to revoke a judicial order barring him from selling his villa, estimated to be worth over €1 million. The order was issued after a request for Mr Pavia’s assets to be frozen was made by the VAT Department, which, along with the Inland Revenue Department, is owed in excess of €1.3 million in tax, penalties and eco contributions.

Mr Pavia had put up a legal fight to save his villa on the premise that the property was not owned by Mambra electronics, the company being chased for the money, but by a subsidiary, Mambra Food and Beverage Limited.

However, the Commissioner of VAT, who fronted the battle, said it was clear Mr Pavia, who bought the property, was hiding behind a corporate structure to buy his own house.

Mr Justice Geoffrey Valenzia said yesterday he could not exclude that Mr Pavia was using the corporate structure as a screen to evade his financial obligations. He ruled that the Commissioner of VAT was justified prima facie in asking for the assets to be frozen but underscored that this did not mean the tax evasion case against Mr Pavia had been proven.

The court concluded that, at this stage of the proceedings, the commissioner’s rights could be irremediably damaged if the warrant of prohibitory injunction was revoked in respect of the villa and the judge therefore dismissed Mambra Food and Beverage’s application.

Lawyers Josè Herrera and Veronique Dalli appeared for Mr Pavia.