A British businessman facing extradition to Germany for questioning over his alleged part in a £100 million VAT scam has denied any involvement.

Peter Singh Virdee, 43, of British-Indian descent, was detained by officers from the Metropolitan Police Service's Extradition Unit on Tuesday at Heathrow Airport, the Metropolitan Police said.

The businessman denies that he has been involved in any kind of fraud or carbon trading, to which the scam is said to be related.

Mr Virdee intends to "defend himself fully" against the allegations, his legal representatives said.

A Met spokesman said: "Peter Singh Virdee, 43, a UK national, was arrested by officers from the Metropolitan Police Service's Extradition Unit on Tuesday January 10 at Heathrow Airport.

"He was arrested on a European arrest warrant on behalf of the authorities in Germany, where he is wanted in relation to tax evasion."

Mr Virdee appeared before Westminster Magistrates' Court on Wednesday, Scotland Yard added.

A spokesman from Carter-Ruck, the legal firm representing Mr Virdee, said: " Our client categorically denies these allegations; he has never been involved in carbon trading let alone in any kind of fraud.

"While he is happy to co-operate with the authorities he intends to defend himself fully against these allegations and the attempts to extradite him to Germany."

The firm said the investigation had been ongoing for six years and that Mr Virdee was "surprised" that the German authorities had applied for his extradition.

It added: "It appears that the only basis for the making of any allegations against our client is from a statement given by a convicted fraudster who entered into some form of plea bargain in return for implicating other people, including our client, in the alleged fraud.

"Our client, however, simply had no involvement in any of the transactions which are said to have constituted the fraud, nor in any fraudulent activity of any kind."

A website appearing to be that of Mr Virdee's lists him as a patron of the NSPCC and the first Sikh patron of the English National Opera.

Recent posts on a Twitter account linked to the website show the businessman posing with ex-SNP leader Alex Salmond and former England footballer Emile Heskey.