The chain’s chief executive Darren Topp alleged that Dominic Chappell issued the death threat when he questioned him over a £1.5 million transfer of BHS money to Sweden.
“If you kick off about it, I’ll come down there and kill you,” Mr Topp claimed Mr Chappell told him.
The claims were made during heated exchanges in front of the Commons business and pensions committees, which are investigating events surrounding the retailer’s collapse.
MPs also heard that Mr Chappell was a “mythomaniac”, a “premier league liar” and a “Sunday pub league retailer”, according to former BHS finance consultant Michael Hitchcock.
Mr Topp added that Mr Chappell’s assurances on buying BHS “unravelled and, rather than putting money in, he had his fingers in the till”. He claimed Mr Chappell received a £1.8 m payment from the sale of BHS and £7m from the sale of the retailer’s offices.
Mr Hitchcock said he was forced to change the company’s bank mandate to “stop any chance of money flowing outside of the business”.
However, Mr Chappell chose instead to focus on the role of Sir Philip in the saga, claiming that the Topshop billionaire blocked a rescue attempt from Sports Direct boss Mike Ashley and tipped BHS into administration.
“Mike Ashley was going to save the business, but Sir Philip Green was screaming down the phone, saying he didn’t want to get involved with Mike Ashley,” he said.
He claimed that on hearing of the potential deal, Sir Philip called in a £35m loan held by his Arcadia group, pushing BHS into administration.
Mr Chappell claimed he did everything in his power to save the firm, including offering Mr Ashley his shares, but his attempts were “rail-roaded” by Sir Philip.
Last week, administrators to the department store chain called time on trying to find a buyer, resulting in the loss of up to 11,000 jobs and leaving behind a £571m pensions black hole. Mr Chappell said that Sir Philip effectively continued to run BHS even after the sale in March 2015 and that the retailer was “saveable”.
He also accused administrator Duff & Phelps of being “heavily conflicted” because of its close connection with Sir Philip, describing the firm as the billionaire’s “pony”.
Mr Chappell concluded by offering an apology for the chain’s collapse, adding: “I am very upset that there are 11,000 people directly and a number of thousand indirectly who have lost their jobs.
“It’s a travesty that that has happened.
“That is an apology.”