An Iranian car salesman who claimed his manager likened him to bungling Fawlty Towers waiter Manuel has lost his case for unfair dismissal.

Pejman Varghai, 33, was sacked by Caffyns Land Rover in Lewes in October 2002 amid accusations he had taken backhanders.

However, he took the company to an employment tribunal claiming he had been unfairly dismissed and had suffered four years of racist insults at work.

He told the tribunal that one manager adopted the mannerisms of Basil Fawlty, played by John Cleese in the sitcom Fawlty Towers.

He claimed the manager said: "Don't worry about him, he's from Barcelona," to a customer.

Mr Varghai, of Tandridge Road, Brighton, also said he had been called a member of the Taliban by staff in front of a customer and that a picture of a terrorist involved in the September 11 atrocity had been circulated with his name on.

Mr Varghai said: "This constant racist behaviour made me feel victimised, isolated, intimidated and very distressed."

He also claimed whenever he made a complaint to management, the number of clients passed to him would decrease and that his commission was not paid in full.

However, sales manager Ian Cox said: "Racial harassment would never have been tolerated by any one of us.

"I have never called Pej any of these names, nor has any other employee."

Richard Samuel, representing Caffyns, said there was no proof of racial harassment.

Mr Samuel also suggested to Mr Varghai that he had accepted between £200 and £500 from a client to push a deal through, which Mr Varghai denied.

Mr Samuel went on to say Mr Varghai was a bullying sex pest.

He claimed Mr Varghai had, in fact, threatened to hit a colleague and exposed himself to a female worker.

He said: "You constantly referred to being black and having a big dick and displayed aggressive sexual behaviour towards women."

Mr Varghai replied that he was a very religious person of the Baha'i faith and his wife was a practising Christian.

Land Rover regional director Martin Blackaby told the tribunal how he would have stamped out any prejudice in his firm, his own parents having fled the Apartheid regime in South Africa.

He said: "I'm very passionate about the fact that I really do abhor racism or any prejudice.

"I know Pej and his family spent time in refugee camps in Iran."

He said he felt sure he would have known about any racism at the firm and that he liked and trusted Mr Varghai.

However, he also said the supplier alleging the backhander had insisted it was true, although Mr Varghai said the supplier was disgruntled because he had gone to a different supplier.