For moving an Item, the Source and Target Folders needs to be in same Version.
So, when the user tries to move an item from OLD version to a parent of NEWER version.
The Parent item does not exist on the OLD version therefore the user is not able to move the item
 
eg: 
Folder 1(2.0)
   item 1(1.0)
   item 2(2.0)
Folder 2(1.0)
  item 3(1.0)
  item 4(1.0)
Now user tries to move an item 3(1.0)  in folder 1(2.0), then user will get the error message