A New Zealander is appearing in a Rangoon court on Thursday after being arrested for insulting religion by using an image of the Buddha wearing headphones in a bar promotion. He could face jail or deportation.

Three managers of V Gastro bar – a newly opened tapas restaurant and nightclub in the upmarket Golden Valley neighbourhood of Rangoon’s Bahan Township – were detained for questioning by police while the bar-restaurant was shut down following an official complaint by the Religious Affairs Department.

Police named the three as: general manager Philip Blackwood, 32, from New Zealand; owner Tun Thurein, 40; and manager Htut Ko Ko Lwin, 26.

The promotional advertisement has now been taken down from the V Gastro Facebook page, but not before it sparked heavy criticism and howls of protest online.

Furious netizens – some shouting for the bar managers to be lynched – were joined by monks from the fundamentalist Buddhist group, ma-ba-tha, in front of the establishment on Wednesday evening, prompting police and local authorities to intervene and mediate.

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The management of the nightclub issued an apology online: “VGastro management would like to express our sincere regret if we have offended the citizens of this wonderful city, who have welcomed us so warmly and generously. Our intention was never to cause offense to anyone or toward any religious group. Our ignorance is embarrassing for us and we will attempt to correct it by learning more about Myanmar’s religions, culture and history, characteristics that make this such a rich and unique society. We thank the citizens of Yangon for their patience and kindness and sincerely hope that our apology will be accepted.”

The poster for the newly opened nightspot portrayed a psychedelic mock-up of the Buddha wearing DJ headphones as part of a drinks promotion for an event on Sunday night.

“According to Mr Philip’s statement, they were trying to promote the bar. Buddha grabs people’s interest. However Buddhists cannot accept this,” Bahan police deputy-superintendent Sgt-Maj Thein Win told reporters late on Wednesday.

He said the three have been charged under articles 295 and 295(a) of the Penal Code for “insulting religion” and ‘hurting religious feelings’. He added that police may seek a closure of the nightclub under Article 188.

Religious incidents have spiralled in recent years in post-dictatorship Burma, with a series of attacks on Muslims. Fundamentalist pro-Buddhist groups such as 969 are frequently accused of stoking violence.