JUDGMENT By the Court.—Heard Sri Rakesh Dwivedi, Senior Advocate and Sri Naveen Sinha, Senior Advocate assisted by Sri Anurag Khanna, Sri Pradeep Aggarwal, Sri Ajai Fatiyal, Ms. Sansuiti Pathak and Sri Nikhil Sharma for the petitioner, learned standing counsel for the respondent No. 1 and Sri Ramendra Pratap Singh, advocate for respondents 2, 3 and 4. Pleadings have been exchanged between the parties and with their consent, we proceed to decide the writ petition at the admission stage itself. 2. By means of this writ petition, the petitioner has prayed for a writ of certiorari quashing the orders dated 1.1.2009, 1.10.2007 and 30.11.2007, whereby the New Okhla Industrial Development Authority (for short ‘’NOIDA’), has called upon the petitioner company to deposit various amounts as change in constitution (for short ‘’CIC’) charges, consequent to the change in its share-holding pattern, which has been made a condition precedent for execution of tripartite sub-lease-deeds between the petitioner company, NOIDA and the sub-lessees and for a mandamus commanding the respondents to execute the tripartite sub-lease-deeds without compelling the petitioner to pay CIC charges. 3. The factual matrix of the case, as is necessary for decision of the controversy involved between the parties, lies in a narrow compass. 4. The petitioner was originally incorporated as a private limited company under the Companies Act and is a deemed Public Company in view of Section 43-A of the Companies Act, 1956. NOIDA allotted it a land ad-measuring approximately 142.4463 acres being plot No. A-2, Sector 38-A, NOIDA, for setting up a Theme Amusement and Entertainment Park of international standard alongwith commercial facilities supportive to the park. In this regard, a license deed dated 31.7.2002 was executed in its favour. Clause 11(12) of the licence deed reads as under : “12. In case of change of constitution, the Licensee/Sub Licensee has to pay proportionate transfer charges on the transferred share as applicable. However, no transfer charges shall be payable during the first two years. The Licensee /Sub Licensee shall be required to retain minimum 25% of the total share for a minimum period of three years in the changed constitution.” In furtherance of the aforesaid stipulation in the licence, the petitioner company vide its letter dated 28.1.2003 furnished details of share-holders of the company, which was as follows : According to aforesaid information furnished by the petitioner company, it was having share capital of Rs. 1 crore divided into 10 lacs shares of Rs. 10/- each. It is evident therefrom that the two major promoters of the petitioner company, namely, International Amusement Ltd. and Unitech Investments Ltd. were holding major part of the shares, i.e., 4,89,990 and 4,99,970 shares respectively. 5. Licence deed was followed by execution of a formal perpetual lease-deed dated 5.2.2003 for the land admeasuring 142.4463 acres. By supplementary agreement, the area of the land has been increased to 147 acres. Clause 11(12) of the lease-deed provides as under : “12. The allottee will have to seek prior permission of the lessor in case of change in constitution. The lessee/sub-lessee will have to pay proportionate transfer charges in the transferred share as applicable. However, change in constitution in accordance with the provisions of the Indian Companies Act, will be permissible within two years.” 6. It appears that out of 5000 shares each held by Mr. Gian Vijeshwar and Mr. Rakesh Babbar, they transferred 4990 shares each to International Amusement Ltd. during the period 28.1.2003 to 5.5.2003. Since these shares were transferred within two years of the licence agreement dated 31.7.2002 and lease-deed dated 5.2.2003, therefore it is admitted to both the parties that the same does not attract any CIC charges. 7. Unitech Investments Ltd. having 49,99,970 shares was one of the main promoters of the petitioner company. It was a 100% subsidiary of Unitech Holdings Ltd. It appears that a scheme for amalgamation was filed under Section 391 and 394 of the Companies Act by Unitech Investments Ltd. to merge it with it’s holding company, i.e., Unitech Holdings Ltd., before the Delhi High Court being Company Petition Nos. 162 of 2005 and 163 of 2005. The Delhi High Court vide judgement and order dated 25.7.2005 allowed merger of Unitech Investments Ltd. (100% subsidiary) with Unitech Holdings Ltd. (holding company of Unitech Investment Ltd.). The relevant portion of the order of the Delhi High Court dated 25.7.2005 reads as follows : “This Court doth hereby sanction the scheme of amalgamation setforth in Schedule I annexed hereto and doth hereby declare the same to be binding on all the share-holders and creditors of the Transferor and Transferee Companies and all concerned and doth approve the said scheme of amalgamation with effect from appointed date, i.e, 1.4.2004. ............... ............... That as on date, the entire share capital of the transferor company is held by the Transferee Company. Accordingly, upon the transfer and merger of Transferor Company under the scheme into transferee Company, there would be no issue of equity shares of Transferee Company to the share-holder(s) of Transferor Company, since the provisions of the Act do not permit Transferee Company to hold its own shares, upon the dissolution of Transferor Company. Under the terms of this scheme, all the shares held by Transferee Company in Transferor Company shall stand cancelled upon the scheme becoming effective without any further act or deed.” As a result of amalgamation of Unitech Investments Ltd. with its holding company, namely, Unitech Holdings Ltd., shares of the petitioner company in the hands of Unitech Investments Ltd. came to be held by Unitech Holdings Ltd. Accordingly, Unitech Holdings Ltd. came to own 49,99,970 shares of the petitioner company w.e.f. 1.4.2004, the appointed date under the sanctioned scheme. 8. According to the petitioner company, in order to raise fund to undertake and complete the project of such magnitude, it had to take financial assistance from Indian Development Fund Corporation, IL & FS Trust Co. Ltd. and IL & FS India Reality LLC, Mauritius and on account of which the petitioner company increased its share capital from 1 crore shares to 13,93,63,000 shares. Out of the increased shares, a major chunk was allotted to the two main promoters, namely, International Amusement Ltd. and Unitech Holdings Ltd. (which took over Unitech Investment Ltd.) and to the three financial institutions so that the share-holding pattern of the petitioner company as on 31.3.2007 was as under : 9. The petitioner company thereafter completed the project by constructing Amusement Park and a commercial complex. Under the lease-deed, the petitioner company was authorised to sub-lease the shops in the commercial complex, for which tripartite lease-deed was to be executed in favour of sub-lessees. Therefore, vide its letter dated 10.9.2007, the petitioner company requested the Noida Authority to execute tripartite sub-lease-deeds of the shops in the commercial building constructed by it in the name of ‘Great India Place’. Alongwith the aforesaid letter, the petitioner company again annexed the list of share-holders and directors of the company at the relevant time. 10. Therefore, vide its letter dated 10.9.2007, the petitioner company requested the Noida Authority to execute tripartite sub-lease-deeds of the shops in the commercial building constructed by it in the name of ‘Great India Place’. Alongwith the aforesaid letter, the petitioner company again annexed the list of share-holders and directors of the company at the relevant time. 10. Thereupon, NOIDA noticed that there has been great increase in the share capital of the petitioner company and it concluded that as per the existing share-holding pattern there has been transfer of 60.54% of the shares of the petitioner company, for which no permission has been taken from it. It therefore required the petitioner company to pay a sum of Rs. 61,44,27,818/- as CIC charges in order to facilitate NOIDA to take further action towards execution of tripartite sub-leases. On receipt of the aforesaid demand from NOIDA, the petitioner company protested against the same vide it’s representation dated 17.10.2007. However, the aforesaid representation of the petitioner company did not find favour with the NOIDA authority and the same was rejected vide order dated 30.11.2007. Undeterred, the petitioner company again represented on 21.2.2008 but it met with the same fate, having being rejected by order dated 1.1.2009. The petitioner company was informed that with the passage of time, CIC charges have gone upto Rs. 68,67,13,414/-. The petitioner company was further threatened that in case these charges were not deposited forthwith, there will be further increase therein w.e.f 30.1.2009. Challenging these orders, the petitioner company has filed the instant writ petition. 11. Sri Rakesh Dwivedi, senior advocate assailing the validity of the impugned orders demanding CIC charges from the petitioner company has made following submissions : (a) The licence and the lease-deed do not define the phrase ‘change in constitution’ (CIC). The aforesaid phrase has been defined in NOIDA policy, according to which CIC charges can be levied only when there is change in legal entity. Since in the instant case, the status of the petitioner company continued to be same since before execution of the licence uptill now, therefore in view of own policy of NOIDA, CIC charge cannot be levied. (b) A mere transfer of share or allotment of share would not amount to change in constitution. Since in the instant case, the status of the petitioner company continued to be same since before execution of the licence uptill now, therefore in view of own policy of NOIDA, CIC charge cannot be levied. (b) A mere transfer of share or allotment of share would not amount to change in constitution. Transfer of share of a company does not result in change of status of a company as share-holder has limited right to share the profits and does not acquire interest in the properties of the company. In this regard, he has placed reliance on the decisions in Bacha F. Guzdar v. CIT, AIR 1955 SC 74 ; State Trading Corporation Ltd. v. CTO, AIR 1963 SC 1811 ; Electronic Corporation of India Ltd. v. Secretary Revenue Department, (1999) 4 SCC 458 ; R.C. COOPER v. Union of India, (1970) 1 SCC 248 and International Hospital Pvt. Ltd. v. State of U.P., (2004) 1 AWC 300 . © In the alternative, he submitted that even assuming that mere transfer of shares is being treated as change in constitution, even then in the present case, clause 11(12) is not attracted, inasmuchas, amalgamation of Unitech Investments Ltd. with Unitech Holdings Ltd., did not involve any transfer of shares. In this regard, he has placed reliance on the judgements in Ramesh B. Desai v. Vipin Vadilal Mehta, (2006) 5 SCC 638 , J.K. Private Ltd. v. New Kaiser I Hind, AIR 1970 SC 1041 and S.K. Gupta v. V.K. Jain, (1979) 3 SCC 54 . (d) Assuming for argument sake that the amalgamation involves transfer of shares, the same was affected on 1.4.2004, the appointed date on which the scheme came into effect as per the orders of the Delhi High Court dated 25.7.2005, which is within the exempted period of two years. (e) The original promoter in the company continued to hold major part of the shares and never lost controlling powers. Even after share capital was increased, the two promoters hold a total share-holding of 13,93,63,000 which is more than 70% of the total share-holding. (f) The allotment of new shares resulting in increase of share capital whether to the original promoters or to the three financial institutions does not amount to transfer of shares. Even after share capital was increased, the two promoters hold a total share-holding of 13,93,63,000 which is more than 70% of the total share-holding. (f) The allotment of new shares resulting in increase of share capital whether to the original promoters or to the three financial institutions does not amount to transfer of shares. When shares are allotted for the first time, it amounts to appropriation of the unappropriated share to the subscriber and cannot be treated to be the transfer of shares. In this regard, reliance has been placed on the decisions in Sri Gopal Jalan v. Calcutta Stock Exchange, AIR 1964 SC 250 ; Sangramsnish v. Shantadevi, (2005) 11 SCC 314 and Khoday Distilleries v. CIT, (2009) 1 SCC 245. (g) By order dated 11.10.2010, the State Government called upon I.G. (Registration), Uttar Pradesh to direct its subordinate not to require deeds of share transfer of a company to be registered under Section 17 of the Registration Act, 1908 and further clarified that no amount is chargeable as stamp duty on such transactions. Following the aforesaid orders/clarification by the State Government, the NOIDA in its 170th meeting passed a resolution clarifying that no CIC charge will be levied on the companies on account of transfer of shares even to the extent of 100% of the share-holdings as it does not result in change of status of the company. It was followed by formal notification dated 27.10.2010 by NOIDA (Annexure SA-1). In view of the said notification /clarification by the NOIDA authority, no CIC charge can be levied against the petitioner company. He has also drawn attention of the Court to the assertions made in the second supplementary-affidavit filed by the petitioner company wherein several instances have been cited in respect of companies to whom benefit of the said notification was given and no CIC charges have been levied on them on account of transfer of shares. The petitioner company is also entitled for benefit of the same as otherwise it will result in hostile discrimination against it. 12. Per contra, Sri Ramendra Pratap Singh, counsel for the NOIDA Authority submitted that the CIC charge was levied on transfer of shares of a company because under the garb thereof, the companies have been indulging in change of ownership. 12. Per contra, Sri Ramendra Pratap Singh, counsel for the NOIDA Authority submitted that the CIC charge was levied on transfer of shares of a company because under the garb thereof, the companies have been indulging in change of ownership. According to him, it had become a novel method to defraud the State of the stamp duty and registration charges which would have been payable in the event of outright sale of immovable assets of a company. In this regard, he has drawn attention of the Court to certain paragraphs of the counter-affidavit which are reproduced below : (i) That the petitioner has devised a novel method of avoiding levy and payment of transfer charges by merely transferring controlling shares rather than selling the assets of the said company. By devising such novel method, even the State is being defrauded of stamp duty and registration charges which would have been payable in the event of outright sale of the immovable assets of the petitioner company. (ii) That it is respectfully submitted that this is a fit case wherein the Hon’ble High Court may lift /pierce the corporate veil and then it would be apparent that the petitioner has indulged in clandestine dealings intended to derive unlawful gains for themselves and in the process cause unlawful damage to the revenue and to the respondent authority. 13. He however admits that the NOIDA Authority after receipt of the clarification from the State Government on 11.10.2010 had itself issued a notification dated 27.10.2010 clarifying that no CIC charge will be levied on transfer of shares by a company and no prior permission is required from NOIDA even in cases where there is cent percent transfer of shares. He drew the attention of the Court to the wordings in the notification which even according to him are wide enough to cover allotments already made and to allotments to be made in future. He fairly submitted that in view of this subsequent development, the stand taken by the NOIDA authority in its original counter-affidavit sworn on 5.7.2009 looses its significance and he is not in a position to support the earlier stand of the NOIDA authority taken in its counter-affidavit. He therefore chose not to address the Court on other issues raised by learned counsel for the petitioner. 14. He therefore chose not to address the Court on other issues raised by learned counsel for the petitioner. 14. In view of the aforesaid, we first proceed to consider whether the petitioner company is entitled to the benefit of the notification date 27.10.2010 or not. For the said purpose, it will be helpful to reproduce the relevant part thereof which reads as follows : ßizkf/kdj.k }kjk fcM ds ek/;e ls vkcafVr ifjlEifRr;ksa lesr lHkh Hkwmi;ksxksa dh vkcafVr ,oa Hkfo”; esa vkcafVr fd;s tkus okyh leLr ifjlEifRr;ksa ds lEcU/k esa vkcaVh dEiuh esa va’k/kkfjrk ifjorZu ds QyLo:i va’k/kkfjrk ifjorZu izys[k fu”iknu dh vfuok;Zrk dks lekIr fd;k tkrk gS rFkk bl laca/k eas dksbZ LVEi M;wVh ns; ugha gksxh A ‘kklu ds mijksDr fu.kZ; ds vkyksd esa fdlh dEiuh esa va’k/kkfjrk ifjorZu ds izdj.kksa esa izkf/kdj.k }kjk vf/kjksfir fd, tkus okys va’k/kkfjrk ifjorZu ‘kqYd dks lekIr fd;k tkrk gS rFkk 100% rd va’k/kkfjrk ifjorZu djus ds fy, izkf/kdj.k dh iwoZ vuqefr fy;k tkuk Hkh lekIr fd;k tkrk gSA mDr vkns’k izkf/kdj.k cksMZ ds vuqeksnuksijkUr tkjh fd, tk jgs gSaAß 15. We have minutely gone through the notification. We also find from its language that there is nothing in it which may warrant taking a view that the notification will apply only to the leases to be executed in future and not to leases already executed. In our opinion, the language of the notification is clear and explicit and it covers both existing and future leases. Infact, the notification is only by way of clarification of the existing policy. It seeks to dispel doubts in the mind of the authorities entrusted with the duty to enforce the stipulation relating to realisation of CIC charges, by clarifying that the transfer of the shares of a company even to the extent of 100% will not result in changing the legal status of a company. The necessary corollary is that CIC charges can be levied only if there is a change in the persona of the lessee/sub-lessee. The aforesaid interpretation is also in consonance with the NOIDA policy and a copy of which has been supplied to us at the time of argument by the counsel for the petitioner. Sri Ramendra Pratap Singh, counsel for NOIDA admitted that the policy aforesaid will govern the case of the petitioner. The aforesaid interpretation is also in consonance with the NOIDA policy and a copy of which has been supplied to us at the time of argument by the counsel for the petitioner. Sri Ramendra Pratap Singh, counsel for NOIDA admitted that the policy aforesaid will govern the case of the petitioner. Thus, there being no dispute between the parties in this regard, we proceed to take judicial notice of the same. According to it, change in constitution means conversion of sole ownership to co-ownership, proprietorship to partnership, change in partners of a firm, conversion of private limited company to public limited company and vice versa, conversion of proprietorship /partnership to private /public limited company. 16. It is thus evident that the notification dated 27.10.2010 is only by way of clarification to the existing policy relating to imposition of CIC charges. It only clarifies that transfer of share of a company doesnot result in change of it’s persona; it continues to be the same legal entity and therefore no CIC charges are leviable on such account. 17. At this juncture, it will be apt to refer to a division bench judgment of this Court in the case of International Hospital Pvt. Ltd. v. State of U.P. and another, (2004) 1 AWC 300 , wherein imposition of CIC charges by NOIDA authority was subject-matter of consideration. It was held as under : “10...... Annexure-E of the writ petition contains the Policies and Procedures for Institutional Premises Management issued by the NOIDA. This document indicates what NOIDA itself means by change in Constitution. In Clause ©(1) thereof it is mentioned that “the application for change in constitution from proprietorship to partnership, Pvt. Ltd. Co., Public Ltd. Co., or vice versa should come from the original lessee(s)/lessee/allottee(s) Transferee(s). 11. Thus, the expression “Change in Constitution” according to NOIDA itself means a change in the legal entity, i.e., from proprietorship to partnership or to a private limited or public limited company. Hence, it is evident that the understanding of NOIDA, itself, which issued this document, was that a change of constitution means a change of the legal entity as mentioned above and not transferring of shares of a company. 12. Shri Vinod Mishra learned counsel for the respondents submitted, however, that sub-clause 5 of clause © of this document indicates, that change within a Company amounts to change in the constitution of the company. 12. Shri Vinod Mishra learned counsel for the respondents submitted, however, that sub-clause 5 of clause © of this document indicates, that change within a Company amounts to change in the constitution of the company. We do not agree. It is well-settled that a company is a distinct legal company separate from its share-holders, as held in the leading case of Salomon v. Salomon and Co. Ltd., 1897 AC 20 (HL). A company, once incorporated, has an entity, which is different from its share-holders and directors vide State Trading Corporation v. C.T.O., AIR 1963 SC 1811 (1822); Ram Chand & Sons Sugar Mills v. Kanhayalal, AIR 1966 SC 1899 (para 9); Electronics Corporation of India Ltd. v. Secretary, Revenue Department, (1999) 4 SCC 458 ; Mrs. Bacha F. Guzdar v. Commissioner of Income Tax, AIR 1955 SCC 74 (77), etc. Hence, if the shares of a company are transferred, it does not mean that the legal entity of the company is changed. In any event, even if the submission of Shri Mishra is accepted, in the present case, there is no charge which can be imposed on the petitioner as change in the constitution charges as the petitioner has retained 25% of/the share as required by Clauses 7 and 9 read with clause 14 of Annexure-E to the writ petition.” 18. The aforesaid judgement was affirmed consequent to the dismissal of SLP No. 692 of 2005 on 24.3.2006 and we find that the judgement above referred applies on all fours to the facts of the instant case. Here also, even after transfer of shares or on amalgamation of one of the main promoters, viz. Unitech Investment Ltd. with its holding company Unitech Holdings Ltd. or upon issue of the new shares, there has never been any change in the legal persona of the petitioner company. It was a deemed public limited company within the meaning of Section 43A of the Companies Act at the time licence /leases were executed in its favour and continues to be so even today. 19. Even after various transfers of shares, the original promoters continued to hold at least 70% share in the petitioner company, which is far above the prescribed limit of 25%. The control of the company remained predominantly with the original promoters. 19. Even after various transfers of shares, the original promoters continued to hold at least 70% share in the petitioner company, which is far above the prescribed limit of 25%. The control of the company remained predominantly with the original promoters. Thus, in every view of the matter, it can safely be held that there has never been any change in constitution (as per NOIDA policy) of the petitioner company so as to warrant imposition of CIC charges. 20. Here it is pertinent to mention that in supplementary counter-affidavit filed by NOIDA authority, it tried to set up a case that the notification dated 27.10.2010 is applicable only prospectively and therefore, the petitioner company is not entitled to its benefit. In order to prove that the aforesaid stand of the NOIDA authority is apparently false and that the NOIDA authority itself had given benefit of the said notification to various companies in whose favour lease-deeds were executed much before the issuance of the said notification, petitioner company had brought on record various instances in this regard by filing second supplementary-affidavit. These instances are as follows : (a) In case of M/s. Raga Impex Pvt. Ltd. allotment /lease-deeds are dated 30.5.2005 and 2.6.2005 and 100% transfer of shares in the said company was not regarded as change in constitution by Noida Authority. (b) In case of M/s. MKG Creations Pvt. Ltd. allotment /lease-deeds are dated 9.10.2009 and 8.12.2009 and 100% transfer of shares in the said company was not regarded as change in constitution. © In case of M/s. Noida Electrical and Moulding Pvt. Ltd. allotment /lease-deeds are dated 22.8.2007 and 15.2.2007 and 100% transfer of shares in the said company was not regarded as change in constitution. (d) In case of M/s. Neelkanth Industrial Consultants Pvt. Ltd. allotment /lease-deeds are dated 4.10.2006 and 22.12.2006 and 100% transfer of shares in the said company was not regarded as change in constitution. (e) In case of M/s. Adsal Exim Pvt. Ltd. allotment /lease-deeds are dated 5.10.2006 and 11.1.2007 and 100% transfer of shares in the said company was not regarded as change in constitution. (f) In case of M/s. Sachdeva Packaging Pvt. Ltd. allotment /lease-deeds are dated 24.6.2009 and 100% transfer of shares in the said company was not regarded as change in constitution. 21. (f) In case of M/s. Sachdeva Packaging Pvt. Ltd. allotment /lease-deeds are dated 24.6.2009 and 100% transfer of shares in the said company was not regarded as change in constitution. 21. The assertion made in this regard by the petitioner were not rebutted by Noida Authority by filing any affidavit in reply thereto. This also clearly proves that even Noida had extended the benefit of the notification dt. 27.10.2010 to the existing leases. In view of it, the petitioner company is also entitled to the benefit thereof. 22. Thus, the irresistible conclusion is that petitioner company is not liable to pay CIC charges and the demand made in this regard vide impugned orders dated 1.1.2009, 1.10.2007 and 30.11.2007 is wholly unwarranted. 23. Since the aforesaid discussion is sufficient for adjudication of the controversy involved in the writ petition and therefore, we do not consider it necessary to go into the other submissions made by learned counsel for the petitioner. 24. In view of the foregoing discussions, the writ petition is allowed and the impugned orders dated 1.1.2009, 1.10.2007 and 30.11.2007 are quashed. Noida Authority is directed to forthwith execute tripartite sub-leases as per stipulation in the lease-deed, without insisting the petitioner company to pay CIC charges. 25. No order as to costs.