Living in a flat without occupation certificate? Maintenance fees may apply

HP RERA says homeowners using flats cannot avoid maintenance dues but builders must justify charges

Homebuyers living in flats without an occupation certificate (OC) or completion certificate (CC) may still have to pay maintenance charges, according to a recent order by the Himachal Pradesh Real Estate Regulatory Authority (HP RERA). However, builders cannot raise arbitrary or unsupported maintenance demands.

 

The ruling came in a dispute involving a homebuyer in Baddi, Himachal Pradesh, who had taken possession of a flat years ago despite the project lacking the required statutory approvals. The builder later sought maintenance dues running into lakhs of rupees, prompting a legal challenge.

 

While HP RERA held that a homeowner enjoying possession of a property cannot completely deny maintenance liability, it also directed the builder to obtain the pending OC and CC within three months and emphasised that maintenance charges must be reasonable, transparent and backed by evidence.

 

Why did HP RERA side with both parties?

 

The authority drew a distinction between a builder’s statutory obligations and a homeowner’s obligation to contribute towards the upkeep of common services.

 

“A flat owner who is in possession and is actually using the premises cannot ordinarily deny the entire liability to pay maintenance,” said Rishabh Gandhi, founder of law firm Rishabh Gandhi and Advocates. However, he added that maintenance demands can still be challenged where they are arbitrary, inflated, unsupported by accounts or relate to amenities that are not functional.

 

The ruling follows a similar principle, according to Shaurya M Tomar, senior partner, Chugh Universal Legal. He said that a person who enjoys the benefits of occupation, including security, lifts, water supply, housekeeping and other common facilities, must also bear a fair share of the cost of maintaining them.

 

Himesh Thakur, associate partner, PSL Advocates & Solicitors, noted that the authority has reinforced a practical legal position: Occupying a flat and using services create a responsibility to contribute towards their upkeep, even if the builder has failed to obtain statutory approvals.

 

Shashank Agarwal, founder of Legum Solis, said the same principle applies even where the property has been rented out. If a homeowner is deriving economic benefit from the flat, complete refusal to pay maintenance is unlikely to find favour with regulators. 

What charges can homebuyers challenge?

 

The order does not give builders a free hand to demand any amount they choose.

 

Madhura Samant, partner, Elarra Law Offices, said homebuyers may question maintenance demands that are arbitrary, excessive, unsupported by records or relate to facilities that have not been provided.

 

Rahul Jajoo, advocate, Delhi High Court, said builders can legitimately recover costs for actual services such as security, housekeeping, common electricity, water supply and upkeep of common areas. However, charges for incomplete, non-functional or undelivered facilities can be disputed.

 

The HP RERA order is particularly relevant for projects where promised amenities remain incomplete or where statutory approvals are pending years after possession.

 

Received a large maintenance bill? Ask for these documents

Experts say homeowners should not blindly pay large lump-sum maintenance demands.

 

 

"A maintenance demand must be an account-backed claim, not a pressure tactic," Gandhi said. He advised homebuyers to seek a detailed break-up of charges, the basis of calculation, services covered and supporting records before accepting the demand.

 

Tomar said the builder should be able to explain exactly how the money is being spent. If sufficient information is not provided, buyers can seek intervention from RERA or other forums.

 

According to Samant, homeowners can ask for:

 

• Detailed statements of expenditure
• Vendor invoices and service contracts
• Audit reports, where available
• Maintenance account records
• Supporting bills and cost calculations

 

Jajoo said seeking such records demonstrates good faith while preserving the right to challenge unjustified charges later.

 

Can builders disconnect services or threaten cancellation?

The authority also took a dim view of coercive recovery methods.

 

Gandhi said builders cannot use water supply, lift access, sewerage facilities or other essential services as a private recovery mechanism for disputed dues. Recovery must take place through lawful procedures.

 

Tomar similarly noted that maintenance disputes cannot be resolved through arbitrary pressure tactics or threats.

 

According to Thakur, HP RERA has already clarified that notices threatening withdrawal of services or imposing conditions beyond the sale agreement cannot be sustained in law.

 

Agarwal said any attempt to cancel allotments, withdraw essential services or impose penalties outside the contractual framework and RERA provisions is unlikely to survive legal scrutiny.

 

Where such actions occur, experts say homebuyers may approach RERA, consumer commissions or courts for relief.

 

The key lesson for homebuyers

 

The order sends a balanced message.

 

Homebuyers cannot occupy or rent out a property, use common facilities and then refuse all maintenance payments. At the same time, builders cannot treat maintenance as a blank cheque.

 

“The practical approach is: do not refuse everything, and do not accept everything blindly,” Gandhi said.

 

Samant described the ruling as a reaffirmation that occupation carries an obligation to contribute towards genuine maintenance expenses, while developers must ensure transparency, accountability and reasonableness.

 

Tomar added that collective action through residents' welfare associations is often more effective than individual disputes.

 

For homeowners, the takeaway is straightforward: pay legitimate maintenance charges for services you actually receive, but insist on transparency and challenge unsupported demands through proper legal channels.