Transfer fees cannot be levied without clear justification based on concrete policy application; a proper record examination is crucial in judicial decisions.

1. The present Letters Patent Appeal is filed by the appellants - original respondents in the main petition being Special Civil Application No. 54 of 2020 decided on 04.11.2020 (AIROnLine 2020 GUJ 2101) by the learned Single Judge whereby, the said petition came to be allowed.

2. The brief background of facts leading to rise of the petition are that respondent - original petitioner is a Company incorporated under the provisions of the Companies Act, 2013 and carrying on business of stainless steel wire mesh cloth at plot no. 3211 situated at GIDC Industrial Estate at Chhatral, District Mehsana in the State of Gujarat. The aforementioned plot i.e. plot no. 3211 was allotted somewhere in the year 1989 initially to M/s. Multi Wires Pvt. Ltd., on lease basis and respondent No. 2 was issued allotment and letter of possession on 14.02.1989. Subsequently, the lease deed came to be executed between respondent No. 2 and M/s. Multi Wires Pvt. Ltd. It is the case of original petitioner that Mr. Jagdish Dubey and Ms. Madhu Kejriwal were the directors in petitioner Company and were associated with Jiten Choksey who was founder member of petitioner Company. At the relevant point of time, said Mr. Jagdish Dubey was having share holding to the extent of 64.07% share and Anay i.e. son of Jiten Choksey was holding 35.93% shares in the Company. Later on, petitioner Company changed its name from M/s. Multi Wires Pvt. Ltd., to M/s. Kumar Wire Mesh Pvt., Ltd., and Ministry of Corporate Affairs issued a certificate of change of name on 08.02.2011. Though, there was no transfer of plot No. 3211 in favour of any other entity, but it was merely a change of name of the company by virtue of S.23 of the Companies Act, but still the petitioner was asked to pay an amount of Rs.62,100/- at the rate of Rs.18.95 per sq., mtrs., as transfer fees. Petitioner at that point of time had no option but to pay the said transfer fees as demanded by the respondents.
2.1. It is further case of the original petitioner, that upon payment of such transfer fee, respondent No. 2 - GIDC issued office order dated 14.10.2011 and transferred the said plot in the name of M/s. Kumar Wires Mesh Pvt. Ltd., and accordingly, even Supplementary Agreement was also executed between petitioner and GIDC with a view to avail financial assistance from financial Institution. Thereafter, petitioner applied for permission as per clause 2(r) of the lease deed to enable petitioner to create charge of lease hold land in favour of the SVC Bank. Somewhere in November, 2016, permission was accorded by respondent for a period of 84 months and at that point of time, respondent No. 2 had not demanded any transfer fee for such issuance of 2(r) permission. At that point of time, i.e. in the year 2016, Ms. Suneja Jhaveri, daughter of Mr. Jiten Choksey and Anay son of Jiten Choksey were directors and Ms. Suneja Jhaveri was holding 99.88% shares whereas, Ms. Madhu Kejriwal who happened to be associate of Mr. Jiten Choksey was holding 0.12% share in the Company. During continuance aforesaid permission, petitioner Company decided to change their bankers from SVC Bank to ICICI Bank somewhere in the June, 2019 and on 25.06.2019, ICICI Bank sanctioned working capital with a condition to create mortgage of lease hold rights in its favour and also put a condition that if security is not created then, the sanctioned timeline after 15 days would attract penalty @ 1% per annum payable on monthly basis and this constrained the petitioner to apply for permission under clause 2(r) of lease deed from respondent No. 2 on 27.08.2019 for permitting mortgage of lease hold rights in favour of ICICI Bank for collateral purpose of this plot no