The Himachal Pradesh Real Estate Regulatory Authority has delivered an important ruling clarifying the rights and obligations of both homebuyers and builders regarding maintenance charges in residential projects.
In a recent order dated May 7, 2026, the authority held that homeowners cannot completely refuse to pay maintenance charges if they are occupying the flat and enjoying its benefits, even when the builder has failed to obtain the mandatory Occupation Certificate (OC) and Completion Certificate (CC).
At the same time, the authority strongly criticized the builder for demanding arbitrary maintenance charges without transparency and for failing to secure statutory approvals and promised amenities.
Background of the Dispute
The dispute involved Mr. Singhal, a retired chief engineer, and his daughter-in-law, who purchased an apartment in Baddi, Himachal Pradesh through a sale agreement.
According to the complaint, the buyers later discovered several deficiencies in the housing project, including:
- Lack of independent water connections
- Absence of a proper sewage system
- Non-availability of several promised facilities
- Failure of the builder to obtain Occupation Certificate (OC)
- Failure of the builder to obtain Completion Certificate (CC)
Despite these shortcomings, the builder allegedly demanded substantial maintenance charges from the homebuyers.
Builder Demanded Rs 3.85 Lakh as Maintenance Charges
On June 12, 2024, the builder issued a demand letter seeking:
- Rs 3.85 lakh towards maintenance charges
- Rs 1.85 lakh towards lift facility charges
The homebuyers challenged these demands, alleging that the lift was non-functional and several essential amenities remained incomplete.
The builder, however, argued that the buyers were already occupying the flat and had even rented it out, thereby deriving financial benefits from the property.
Can Homeowners Refuse Maintenance Charges?
The central question before the authority was whether homebuyers could completely deny liability for maintenance charges when the builder had failed to obtain OC and CC.
The authority answered this question in the negative.
According to the order:
Once an allottee is in possession of the property and is availing services, even basic services, maintenance liability cannot be completely denied.
The authority observed that homeowners cannot enjoy possession and rental income from the property while simultaneously refusing to meet their maintenance obligations.
RERA Observes Homebuyers Cannot Take Dual Positions
The authority made a significant observation:
A party cannot accept the benefits of a situation and simultaneously refuse to perform obligations arising from it.
The authority found that the flat was already occupied and had even been rented out, demonstrating that the owners were deriving benefits from the property.
Therefore, complete denial of maintenance charges was held to be unjustified.
Builder Cannot Demand Arbitrary Maintenance Charges
While recognising the builder’s right to recover maintenance charges, the authority emphasized that such recovery must comply with legal requirements.
The authority noted serious concerns regarding:
- Lack of transparency in maintenance calculations
- Absence of proper break-up of charges
- Failure to provide supporting documents
- Unsupported and arbitrary demands
The authority observed that maintenance charges must be:
- Reasonable
- Transparent
- Properly documented
- Supported by evidence of actual services provided
Possession Without OC and CC Not Legally Complete
A major finding in the case was that possession of a flat without obtaining Occupation Certificate and Completion Certificate cannot be regarded as legally complete.
The authority observed that the builder had failed to comply with earlier directions requiring it to obtain these statutory approvals.
Accordingly, the authority reiterated that:
- OC and CC are mandatory legal requirements
- Builders cannot indefinitely delay obtaining them
- Homebuyers are entitled to lawful possession backed by statutory approvals
Coercive Recovery Notices Held Unsustainable
The authority also examined allegations that the builder had issued coercive notices threatening adverse action for non-payment.
The authority held that:
- Recovery of dues must be carried out through lawful procedures
- Builders cannot issue arbitrary threats
- Cancellation threats beyond contractual provisions cannot be sustained in law
- Unreasonable conditions cannot be imposed on allottees
The order reinforces that builders must follow due process while recovering maintenance dues.
Builder Directed to Obtain OC and CC Within Three Months
Taking a strict view of the builder’s continued non-compliance, the authority directed the builder to:
- Obtain Occupation Certificate (OC)
- Obtain Completion Certificate (CC)
within three months.
The authority further ordered that failure to comply would attract a penalty of Rs 2,000 per day.
This direction highlights the regulatory importance attached to obtaining mandatory approvals before a project is considered fully compliant.
General Body Meeting Must Determine Maintenance Charges
To ensure fairness and transparency, the authority also directed the builder to convene a General Body Meeting of the Residents’ Welfare Association (RWA) within one month.
The purpose of the meeting is to:
- Discuss maintenance requirements
- Determine reasonable maintenance charges
- Ensure participation of residents
- Create transparency in cost allocation
Once maintenance charges are finalized through this process, homeowners will be required to pay the approved amounts within the stipulated time.
Significance of the Ruling
The decision is significant because it balances the rights and responsibilities of both builders and homebuyers.
The ruling clarifies that:
For Homebuyers
- Occupying a flat creates maintenance obligations.
- Maintenance cannot be completely denied merely because OC and CC are pending.
- Homebuyers can challenge excessive or unsupported charges.
- Recovery threats must comply with law.
For Builders
- Maintenance charges must be reasonable and transparent.
- Arbitrary demands are not permissible.
- OC and CC must be obtained within a reasonable period.
- Essential services and promised amenities must be provided.
Conclusion
The ruling by the Himachal Pradesh Real Estate Regulatory Authority establishes an important principle under RERA. While homeowners occupying a property cannot escape their responsibility to pay legitimate maintenance charges, builders cannot exploit the situation by levying arbitrary charges or withholding statutory compliances.
The authority’s order strikes a balance between consumer protection and contractual obligations, ensuring that maintenance charges remain fair, transparent, and legally justified while compelling builders to fulfil their obligations regarding Occupation Certificates, Completion Certificates, and promised amenities.
