Three diners were hurt when flames spread through The Pour House, off Water Lane in the city centre, Leeds magistrates were told.
It happened after vapours caught fire as a member of staff filled the ethanol-fuelled fire inside the restaurant on May 19.
Inspectors from West Yorkshire Fire and Rescue Service subsequently found the owners had breached fire safety regulations relating to the storage and use of dangerous substances.
The Granary Pub Company Ltd, which owns the restaurant, pleaded guilty to fire safety failings.
It was fined £15,000 and ordered to pay costs of £2,560.
West Yorkshire Fire and Rescue Service’s fire protection manager Chris Kemp said: “In this case the defendant fell significantly short of the standards required to comply with their duties under the legislation, they should have taken the time to check their responsibilities with regard to fire safety and particularly the use of a volatile product like ethanol.
"These breaches would have been relatively simple to identify and to deal with, but resulted in a traumatic experience for both employees and members of the public and the situation could have been far worse.
“It is pleasing to see that the company have subsequently sought advice and put appropriate measures in place to risk assess the use of ethanol in the restaurant.
“Members of the public should be able to frequent commercial premises in the comfort that the owners of those premises have taken all necessary steps to ensure their safety. Where we identify situations which put people at serious risk we will take immediate action and consider prosecuting those responsible.”