If you know Tamil, you can read on u-tube an interview of Shiva Ayyadurai considered the inventor of email in which he says he was told of this practice in childhood by his mother and how upsetting he found it to be.
Is there scriptural basis for this?
All Smritis say that twice borns must not use water from the Sudras for bathing or for rituals like Achamana.
Raw meat, clarified butter, oil, and oily substances entrailed from fruits, even when kept in vessels of degraded castes, attain to purification when brought out. (247)
By knowingly drinking water from the Sudras, a Brahmana should fast for a day and night and, [then] after bathing, should get [himself] purified with the Panchagavya. (248)
Atri Smriti
[He should not rinse his mouth] with water placed in one palm, [and should rinse it] again [with water brought by all castes], excepting a Sudra. [He should not rinse it while] seated, with his sandals on, or keeping his hand outside the knee,
Usana Smriti
So, the prohibition does not seem to be there w.r.t any of the twice born castes. Only Sudra's water is not recommended.
So, water brought from a Sudra's well is having a prohibition on it.
