Maintenance billing is one of the most common areas of confusion in apartment communities. Questions around how Common Area Maintenance (CAM) charges should be calculated often lead to disagreements between residents, treasurers, and Management Committees. And these unresolved disputes, sometimes even land up in courts.
To help housing societies better understand practical approaches to set up CAM billing, which becomes fool proof and legal defensible, ADDA recently conducted an awareness workshop for RWAs and Management Committee members.
The session was conducted by San Banerjee, CEO & Co-Founder of ADDA, along with Satish Mallya and CA Ramesh Padmanaban, Governing Council Member and Legal Lead at the Bangalore Apartment Federation (BAF), joining as panelists.
The workshop had originally been planned to have limited slots of 100, but due to the strong response and large number of registrations, the capacity had to be extended to 150 participants. Attendees included treasurers, MC members, and residents from apartment communities across India who deal with society finances.
This blog captures the key themes discussed during the session and the common questions that apartment communities face when preparing maintenance invoices.
Table of Contents
Why CAM Billing Is a Frequent Source of Disputes
If you live in an apartment community, you have probably heard this debate at some point: Should maintenance charges be equal for all flats, or calculated based on the size of the apartment?
Different communities follow different methods. Some charge equal maintenance across all units, while others calculate charges based on the apartment’s square foot, while others goes ahead and uses hybrid of both methods.
Over the years, different interpretations and court rulings in various cities have added to the confusion. As a result, many Management Committees find it difficult to clearly explain why a particular billing method is being followed.
The workshop aimed to bring clarity to this issue by helping participants understand what the law says and how associations can approach billing decisions responsibly.
Understanding Apartment Laws and Why Maintenance Bills Are Often Misunderstood
One of the key points discussed in the workshop was the importance of understanding the law under which a housing society is registered.
In Maharashtra Co-operative Housing Societies, there are clearer guidelines and model bylaws that define how CAM expenses and maintenance invoicing should be structured. Because of this, most associations in the state have a clearer framework when preparing their maintenance bills.
However, in many other states, the situation is different. Apartment communities often operate under Apartment Ownership Acts, such as those in:
- Karnataka
- Tamil Nadu
- Kerala
- Telangana
- Andhra Pradesh
- West Bengal
While these laws define ownership structures and responsibilities within apartment communities, they do not always provide the same level of detailed guidance on how maintenance invoices should be structured in practice.
This is one of the reasons why maintenance billing is often misunderstood in many apartment communities. In some societies, the maintenance bill appears as a single service charge line item, while in others it is split into multiple components that together make up the total CAM amount.
Because of these differences, residents across communities may have very different expectations about how maintenance charges should be calculated and presented.
The workshop highlighted that for Management Committees and treasurers, it is important to first understand the legal framework of their association and the clauses related to common expenses before deciding how maintenance invoices should be structured.
Handling Disagreements Among Residents
Disputes around CAM billing usually arise when residents feel the calculation method is not fair.
For example:
- Owners of larger apartments may question higher charges when maintenance is calculated per square foot.
- Owners of smaller apartments may object if maintenance is charged equally across all units.
The workshop explained what management committees must do when such disagreements arise.
Active Participation and Real Questions from Communities
The workshop included a presentation followed by an extended Q&A session, where participants raised practical questions based on real experiences in their communities.
Some of the topics discussed included:
- Interpreting apartment laws in different states
- Structuring maintenance invoices
- Managing disagreements among residents
- Making billing changes through AGM processes
The discussion showed that CAM billing decisions are not just accounting decisions, but community governance decisions.
Why Workshops Like This Matter
Apartment communities today manage many responsibilities starting from finances and compliance to communication and dispute resolution.
Workshops like this help Management Committees, RWAs and treasurers understand both the legal context and the practical realities of running a community.
With better awareness and the right tools, RWAs can make maintenance billing more transparent, structured, and easier for residents to understand.
Explore How ADDA Simplifies Apartment Accounting
If your association wants to simplify maintenance billing and generate structured CAM invoices for your community:
Explore ADDA’s Apartment Accounting and Billing Software
https://adda.io
Questions from RWAs and MC Members During the CAM Invoice Workshop
During the session, participants asked several practical questions based on real situations they face while managing finances in their apartment communities.
The experts addressed questions ranging from maintenance calculation methods and legal frameworks to GST implications, hybrid billing models, and dispute resolution within societies.
1. Our villa community is registered under the Karnataka Society Act 1960. Is that correct and how should maintenance be calculated for us?
The Society Act is a generic law used by many types of associations and does not specifically address property ownership structures. Because of this, it does not clearly define how common expenses should be shared.
Communities registered under this act usually follow their own bylaws for maintenance calculations. However, registering under the Apartment Ownership Act provides a clearer legal framework for calculating expenses based on ownership share.
2. What is the difference between the Apartment Owners Act and the Society Act?
The Society Act is a broad law used by different types of organizations such as charitable groups, clubs, and associations. It does not specifically address apartment ownership or property-related cost sharing.
The Apartment Ownership Act, on the other hand, is designed specifically for apartment communities and defines ownership rights, undivided share of property, and the framework for common expenses.
3. Our society charges fixed maintenance because we are registered under the Society Act. Is this acceptable?
Yes, this can be acceptable if the society’s bylaws allow it. However, Apartment Ownership Acts typically provide clearer guidance regarding ownership share and maintenance calculations.
4. If one apartment has one resident and another has five residents, how can equal maintenance be considered fair?
Maintenance expenses can generally be categorized into two types:
Usage-related expenses – such as security, housekeeping, and lighting, which benefit all residents equally.
Ownership-related expenses – such as insurance and long-term infrastructure maintenance, which are tied to the property itself.
Associations often distribute these expenses differently depending on the category.
5. Under the Karnataka Apartment Ownership Act, should maintenance be charged equally or based on square footage?
Under the Karnataka Apartment Ownership Act, common expenses are generally linked to ownership share, which usually corresponds to the apartment’s size or undivided share in the property.
6. Can an AGM resolution override the law regarding maintenance calculation?
No. Legal provisions in the applicable act take precedence over decisions taken by the General Body. Associations cannot override legal ownership structures through voting.
7. If the sale deed mentions square foot basis, can the association move to a hybrid maintenance model?
Most sale deeds state that maintenance will be determined by the association. Therefore, associations can adopt or revise billing models with approval from the General Body.
8. Can societies design their own hybrid maintenance model?
Yes. Many communities adopt hybrid models where some expenses are shared equally and others are calculated based on apartment size. However, the model should be transparent, fair, and approved by the General Body.
9. Can maintenance charges be calculated on a per-person basis?
While it may be theoretically possible if approved by the General Body, it is rarely used in practice because the number of occupants in a unit can change frequently and is difficult to track.
10. What expenses typically fall under the Repair and Maintenance Fund?
These may include:
- 1.Major repairs to common infrastructure
- 2.Replacement of mechanical parts in equipment
- 3.Annual maintenance contracts (AMCs) for lifts, generators, and other systems
Associations usually define these clearly in their bylaws.
11. What are examples of day-to-day operating expenses in apartment communities?
Typical operational expenses include:
- Security services
- Housekeeping staff
- Common electricity
- Generator fuel
- Water supply management
These are often shared equally across all units.
12. How should insurance premiums be treated in maintenance billing?
Insurance protects the value of the property and is usually treated as an ownership-related expense. As a result, it is often calculated based on apartment size or ownership share.
13. What is the difference between Corpus Fund, Sinking Fund, Buffer Fund, and Repair Fund?
There is no universal definition across all states. Each association typically defines the purpose and collection method of these funds in its bylaws.
Generally:
- Repair Fund covers mid-term repairs
- Sinking Fund is meant for long-term asset replacement
- Corpus or Buffer Funds are reserves for future contingencies
14. How should corpus funds be collected from new owners?
Since corpus funds are usually created for specific purposes, the method of collection is typically decided by the General Body of the association.
15. How do societies determine the amount to collect for repair and sinking funds?
Some societies base this on a percentage of construction cost. Associations may periodically revise this amount to account for inflation and future maintenance needs.
16. Is GST applicable on borewell water supply or generator power usage?
GST applicability depends on whether the service involves processing or treatment. Associations are generally advised to consult tax professionals for clarity in specific cases.
17. If residents pay electricity bills directly to the utility provider, does GST apply?
No. Electricity supplied directly by government utilities is exempt from GST.
18. Can societies split maintenance charges into components to avoid GST?
This approach is generally discouraged because authorities may treat maintenance services as a bundled offering and apply GST on the total amount.
19. What items are typically included in maintenance invoices in Maharashtra societies?
Invoices often include multiple components such as:
- Service charges
- Water charges
- Common electricity
- Insurance
- Repair fund
- Sinking fund
This structure helps create a more transparent breakdown of expenses.
20. In plotted or villa communities, should repair and sinking funds apply to individual villas?
These funds generally apply only to common infrastructure and shared amenities, not to privately owned villas or plots.
21. If water supply is metered, can societies charge residents based on consumption?
Yes. Charging based on actual metered usage is often considered the most accurate and transparent method.
22. How should generator diesel costs be allocated among apartments?
Communities may choose different approaches such as:
- Equal sharing across units
- Allocation based on electrical load
- Meter-based billing where infrastructure allows
23. Do the same maintenance rules apply to Apex Associations?
Not necessarily. The rules depend on the act under which the Apex Association or federation is registered.
24. Is it mandatory to show detailed line items in maintenance invoices?
Not always. However, itemized invoices are often preferred because they provide greater transparency to residents.
25. Can apartment associations rent out common areas?
Yes. Associations can rent out common spaces such as commercial kiosks or facilities if the decision is approved by the General Body and permitted by the bylaws.
26. If a flat is rented out, can the association charge non-occupancy charges?
Yes. Non-occupancy charges typically apply when the owner does not live in the apartment and rents it out to tenants.
27. How can societies recover unpaid maintenance dues?
Associations typically recover pending dues when the property is sold or rented, since a No Dues Certificate may be required to complete the transaction.
28. What can societies do if very few residents volunteer for the Management Committee?
Some communities introduce honorariums or sitting fees to recognize the time and effort involved in managing the association.
29. Can societies change their maintenance billing structure later?
Yes. Changes to billing structures can be introduced through proper governance processes such as approval in a General Body Meeting.
30. What should associations do when residents disagree about maintenance calculations?
The best approach is to discuss the issue transparently within the association, typically through a General Body Meeting, and arrive at a solution that aligns with the law, the bylaws, and fairness for all residents.