Property tax before possession

Dinesh Kandpal (Querist) 29 January 2025 This query is : Resolved
Dear Sir,

Does Housing society have power to impose property tax charges on the home buyer prior to the possession date?

The Home buyer has the letter from the builder that he is not liable to pay any charges prior to the possession.

Can buyer take the matter to Registrar or he has to pay retrospective property tax for the period prior to possession.

Your views would be appreciated.

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Quick Summary

This discussion clarifies whether a housing society can legally impose property tax charges on a home buyer before the possession date. Generally, the builder is responsible for all taxes, including property tax, until the property is officially transferred to the buyer. If the property has been registered in your name, you become liable for taxes from that point onwards, regardless of occupancy. While the possessor may have to pay the tax initially to clear arrears, they can then seek recovery from the builder if the agreement stipulates it.

T. Kalaiselvan, Advocate (Expert) 29 January 2025
The builder is responsible for paying all taxes, including property taxes until the property is transferred to the buyer. The responsibility to pay the taxes cannot be transferred to the buyer by the builder.
However, if the property had been registered on your name and the same has been handed over, you are liable to pay the applicable taxes, immaterial of the flat that you have occupied it or let it out on rent or it is lying vacant.

Dr. J C Vashista Online

(Expert) 30 January 2025
I fully agree iwith the opinion and advise of learned senior expert Mr. T Kalaiselvan. The titleholder is liable to pay property tax right since the time it (property) has been transferred in his/her name. However, it is the property and not individual to be put to tax laibility.

Kishor Mehta (Expert) 02 February 2025
If the builder has not paid the property tax levied on the premises, the owner occupier has to pay it, and then, if as per the legal opinion it is the builder's liability, then he/she has to collect it from the builder.

Dr. J C Vashista Online

(Expert) 02 February 2025
The possessor of the property has to deposit the tax and recover from the vendor/ builder

Kishor Mehta (Expert) 02 February 2025
The society has no business to ask for property tax, it is a matter between the builder, property purchaser and the local municipal authorities. If the builder has failed to pay the property tax it becomes the liability of the purchaser to pay the property tax and he may collect it from the builder if it is so provided in the agreement to purchase.

P. Venu (Expert) 09 February 2025
Property tax is a first charge upon the property. As such, the new occupier can clear the arrears and recover the same from the builder/earlier occupant.

Dinesh Kandpal (Querist) 16 March 2025
thank you sirs for your help with replies.

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