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South India Bank has challenged the Yamuna Expressway Industrial Development Authority’s (YEIDA) imposition of charges for the commercial transfer of land before the Allahabad High Court. The Bank challenged the validity of YEIDA internal memo issued in 2017 which called for the imposition of charges for the commercial transfer of landat the rate of 10% of the market value or circle rate. The Bench comprising Justices B Amit Sthalekar and Piyush Agrawal has restrained YEIDA was imposing any transfer charges on South Indian Bank. The bank had been informed about the transfer charges in 2018, following a meeting with YEIDA.A concession agreement for the project had originally been entered into in 2003. However, YEIDA told the bank that, transfer charges would have to be paid before the transfer of land intended by the sub-lease could take place.
In February 2019, the Bank wrote to YEIDA twice stating that, original concession agreement as well as the Master Lease did not envision the imposition of any additional charges, transfer charges or premiums before the transfer of land. The bank referred to Clause (e) of Chapter IV of the Concession Agreement and Clause 4 of the Master Lease Deed in this regard. Two important sub clauses were mentioned. Firstly,the requirement to seek any prior approval from the Respondent in this regard and secondly, the payment of any transfer charges this regard to the Respondent or to any other relevant authority.
The YEIDA insisted on the payment of such transfer charges, if failed then it refused to grant South Indian Bank the No-Objection Certificate (NoC) required for the registration of the sub-lease. The bank challenged the validity of the memo stating that, it had never been notified by the authorities. Further, the petition states that, imposition of transfer charges in this manner would be beyond the scope of the YEIDA’s jurisdiction. It will come into conflict of the parent act , i.e The Uttar Pradesh Industrial Area Development Act, 1976.
Lastly, it has been contended that, the memo cannot take away the Bank’s rights under the Concession Agreement and Master Lease Agreement. Further, the Bank has challenged has the imposition of transfer charges by YEIDA as illegal, ultra vires, and infringement of the Bank’s rights under Articles 14, 19 and 21 of the Constitution. Subsequently, South India Bank has sought for the quashing of the 2017 internal memo.
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