Hey Awwal,
I discovered the same issue, not being able to transfer liquid fuel & oxidizer between two tanks of separate vessels while being docked directly inbetween those. However transfer EC, LifeSupport, etc. was possible across all other parts. I assume have R&D fully upgraded. First idea was that it is linked to Kerbal Attachement System, but problem did not occur in Sandbox mode.
I resolved it, by disabling the resource transfer obeys crossfeed limitation in advanced options menu. This option is disabled in Sandbox mode.
Since mostly into Planes and SSTO's, this is no problem for me, but this allows fuel flows in staged rockets which are not feasible from realism POV.