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Salim Mehajer Wants His Bankruptcy Ruling Annulled

A court hearing that ended in Salim Mehajer being declared bankrupt should have been adjourned because the controversial Sydney businessman was in jail at the time, his lawyer says.

The former Auburn deputy mayor was declared bankrupt by a Federal Circuit Court judge in March, before he was granted bail in early April over claims he staged a car crash and defrauded an insurance company.

The 31-year-old's lawyer, David Hume, has asked the Federal Court to annul the decision and Justice Michael Lee has adjourned the case to later on Thursday.

Mehajer, who was not present in court, recently announced on social media platform Instagram that he had lodged the application to "set aside this joke", claiming "only God can bankrupt me".

The petitioning creditor for the March bankruptcy order was the liquidator of Mehajer's own company, SM Project Developments, over a debt of about $200,000.

The application was supported by other creditors including the Australian Taxation Office (ATO) and Prime Marble & Granite Pty Ltd.

On Thursday, Mr Hume outlined Mehajer's case which included a claim that an adjournment of the bankruptcy hearing should have been sought because he was in custody.

He also said that Mehajer had been granted extensions by the ATO on objection notices, but before this expired he was taken into custody.

"It bears on whether an adjournment should have been sought," he said.

Describing his client's financial affairs as "very complex", the lawyer also foreshadowed engaging a forensic accountant to report on Mehajer's financial position as at the date of bankruptcy.

Initial inquiries had failed to find one due to them being "conflicted or unwilling", he added.

Mr Hume also submitted that the creditor's petition had been deficient, allegedly misstating the debt and "was apt to mislead".

Roger Marshall SC, for the bankruptcy trustee, said a major concern would be who was actually going to pay for the forensic accountant.

AAP

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