Yes. You are right. Companies must pay the candidate what's he/she is worth of getting payed and not based on the old companie's CTC. Actually this cheap procedure is making people tell lies. Bigger companies know the fact that small companies don't pay like them. Inspite of that, they happen to ask employees from start up organizations about CTC and if the person tells the truth, I am sure he/she is treated as a dumbshell.
Thanks a lot for your loud voice against bad things.