Environmental health officers who visited Denny's restaurant on Broadway in the city found worktops and equipment encrusted with food debris, lavatories opening into food rooms and doors blocked open.
In the cellar, a sewage pipe had become blocked and backed up so that drinks kept down there were standing in sewage sludge.
There had been no outbreak of food poisoning but Peterborough magistrates are thought to have taken a dim view of the way the premises had deteriorated since the last inspection six months previously. On that occasion some defects were noted in a warning letter to the restaurant but they had not been put right.
The owner of the 100-seat restaurant, Sek Fat Cheng, pleaded guilty to nine charges under food-safety regulations. The restaurant remains open, although the blocked pipe has been repaired and other essential work carried out.
Council officials said they were staggered by size of thefine. Trevor Gibson, head of environmental and public protection, said: "We nearly fell off our chairs."
Arthur Cater, manager of Denny's, said he was considering appealing. "There have been some horrendous stories involving restaurants locally that were only fined pounds 2,000 to pounds 3,000 ... [the fine] is going to affect the business badly."
He said the problem was caused by a blocked drain in the street, but "environmental health officers took no excuses".
The Chartered Institute of Environmental Health said the size of the fine was an indication of a new determination among magistrates to get tough over food safety. A spokesman said: "This kind of fine is the only effective deterrent."
There are an estimated 600,000 food businesses in Britain and about 1,000 prosecutions a year.
The number of prosecutions has fallen in recent years as the Government has encouraged a move to informal enforcement, using persuasion rather than threats.
The Institute spokesman said: "We welcome the informal approach but it has to be backed by the ultimate sanction of closure."Reuse content