Quick answer
In an order on a complaint by a Kengeri, Bengaluru flat buyer, K-RERA held that builders must bear municipal taxes, water, electricity and maintenance costs until possession under Sections 11(3) and 11(4) of the RERA Act, and cannot add 18% GST to BWSSB domestic water bills. It also rejected ₹1,18,487 of extra charges and over 600 days of delay interest, and ordered the builder to correct the demand and refund excess GST.
Published 12 November 2026 · Source: Trade Brains, 8 November 2026
The Karnataka Real Estate Regulatory Authority (K-RERA) has ruled that a builder cannot pass project running costs such as municipal taxes, water and electricity charges and maintenance on to buyers before the flat is handed over, and cannot add GST to domestic water bills from the Bangalore Water Supply and Sewerage Board (BWSSB). The order came on a complaint by a buyer of an apartment in Kengeri, west Bengaluru, and was reported on 8 November 2026.
What the buyer was charged
- 18% GST on BWSSB water charges. K-RERA said domestic water supplied by a public body is zero-rated, so GST should not be added.
- ₹1,18,487 over and above the water-related dues listed in the sale agreement.
- Delay interest for more than 600 days from 11 February 2024. The builder could not show any email, notice or message telling the buyer the dues were pending, so K-RERA held the interest was not justified.
The builder argued that the flat was sold at a fixed, all-inclusive price and that BWSSB charges were statutory service charges outside that price. K-RERA did not accept this, relying on Sections 11(3) and 11(4) of the RERA Act, which make the promoter responsible for these outgoings until possession is handed over.
What K-RERA has ordered
- Remove GST from the domestic water bill
- Correct the demand letter and the construction-stage statement
- Explain the extra GST collected and refund it where applicable
The builder and project have not been named in reports of the order.
Charges to question on your own demand letter
Final demand letters in Bengaluru often carry a long list of extras on top of the agreement value. This order gives buyers firmer ground to push back on items that relate to the period before possession:
- Property tax, water and electricity bills for the building before your handover date
- Maintenance or association charges billed for months before you receive the keys
- GST added to BWSSB or BESCOM deposits and pass-through charges
- Interest on delayed payments where the builder never sent you a written demand
- Any charge that is not listed in the sale agreement
Ask for an itemised statement for every demand, keep proof of every payment and of every demand you receive, and compare each line with the cost sheet attached to your agreement. If a builder will not correct a charge, a complaint can be filed online with K-RERA. We list the RERA registration for every project in our Bengaluru city guide, and our guide to another recent RERA order shows how regulators are treating misleading claims.
Frequently asked questions
Can a builder charge GST on BWSSB water bills in Karnataka?
No. K-RERA held that domestic water supplied by a public body is zero-rated, so the builder must remove the 18% GST it added to the water bill.
Who pays property tax and maintenance before possession?
The builder. K-RERA relied on Sections 11(3) and 11(4) of the RERA Act, which make the promoter responsible for these outgoings until the flat is handed over.
Can a builder charge delay interest without sending a demand?
In this case K-RERA rejected more than 600 days of delay interest because the builder could not show it had told the buyer the dues were pending.
Which project was the K-RERA order about?
An apartment project in Kengeri, Bengaluru. The builder and project have not been named in reports.
What should I do if my builder adds charges not in the agreement?
Ask for an itemised statement, compare it with the cost sheet in your agreement, keep written records, and file a complaint with K-RERA if the builder will not correct it.
Sources
BookNewProperty is an independent research site. This report summarises the sources above; figures are as published by them on the dates shown.
Vikas H S is the Project Reviewer at BookNewProperty. He reviews every project page against the developer and the state RERA portal, and writes the site's developer results and market news in plain language for first-time buyers.
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