A universal donee is liable for the debts due or liabilities by the donor at the time of the gift to the extent of the properties and not necessary to file suit.

Headnote:
TRANSFER OF PROPERTY ACT - SECTION 128 - LIABILITY OF UNIVERSAL DONEE - ATTACHMENT OF GIFTED PROPERTY - COURT HELD THAT THE UNIVERSAL DONEE IS LIABLE FOR THE DEBTS DUE OR LIABILITIES BY THE DONOR AT THE TIME OF THE GIFT TO THE EXTENT OF THE PROPERTIES AND NOT NECESSARY TO FILE SUIT.
Fact of the Case:

The petitioner filed a suit for recovery of money against the first respondent. During the pendency of the suit, the first respondent died and the respondents No. 2 to 4 were brought on record as Legal Representatives of the deceased first respondent. Subsequently, the suit was decreed against the estate of the deceased first respondent lying in the hands of the respondents/J.Dr Nos. 2 to 4. After passing of the decree, the petitioner made several demands to the J.Dr Nos.2 to 4 to discharge the decree debt, but they did not choose to pay any amount. Thereafter, the D.Hr filed the present E.P. for attachment and sale of the E.P schedule properties to realize the decree debt.
Finding of the Court:

The Court observed that, as per Section 128 of T.P. Act, a person who gets the properties of the donor under a gift he/she is liable personally for all the debts due and liabilities by the Donor at the time of the gift to the extent of the properties. In the present case, the deceased first respondent was executed a gift deed by giving gift of properties in favour of the 4th respondent as such she is liable for debts due or liabilities by the donor i.e., the first respondent at the time of execution of gift. The 4th respondent herein is the done as such she is liable for all the debts due and liabilities by the 1st respondent at the time of the gift to the extent of the property comprised therein. As such the 4th respondent is liable for paying decretal amount to the petitioner.
Issues: Whether the universal donee is liable for the debts due or liabilities by the donor at the time of the gift to the extent of the properties?
Ratio Decidendi: The Court relied on the provisions of Section 128 of the Transfer of Property Act, 1882, which states that where a gift consists of the donor's whole property, the donee is personally liable for all the debts due by and liabilities of the donor at the time of the gift to the extent of the property comprised therein. The Court also referred to various case laws, including Dayanandan, minor, by mother and guardian Saradambal and another v. Venugopal Naidu, Parvesh Kumar Versus H.P. State Forest corporation Ltd. & others, Lingareddi Sreenivasulu Reddi (died) and others Versus D. Muniratnam Reddi and others, Sri Kokkirapati Venkata Ratham Versus Sri Mellimi Samuel John (died) and others, and Shanmugam and 2 others vs. M/s. Syndicate Bank, rep. by Branch and Agent, Vysial street, Coimbatore and 9 others, to support its decision.
Final Decision: The Court allowed the Civil Revision Petition and set aside the order passed by the Court below. The Court directed the attachment of the E.P. Schedule properties which belong to the deceased first Judgment Debtor, lying in the hands of the Judgment Debtors No.2 to 4 and thereafter to sell the properties in the public auction, to enable the Decree Holder to realize the decree debt.

ORDER :

This Civil Revision Petition is filed by the petitioners against the Order and decree, dated 13.03.2020 passed in E.P.No.116 of 2019 in O.S.No.74 of 2017 on the file of the Court of Principal Senior Civil Judge, Nandyal.

2. Heard Sri B.S. Reddy, learned counsel appearing for the petitioner and Sri G. Sravan Kumar, learned counsel appearing for the respondents.

3. Learned counsel for the petitioner/plaintiff submits that the plaintiff has filed the main suit in O.S No.74 of 2017 for recovery of money against the first respondent. During pendency of the suit, the first respondent/first defendant died and as such the respondents No. 2 to 4/defendants No.2 to 4 were brought on record as Legal Representatives of the deceased first respondent. Subsequently, the suit was decreed on 30.04.2019 against the estate of the deceased first respondent/J.Dr lying in the hands of the respondents/J.Dr Nos. 2 to 4. After passing of the decree, the petitioner/plaintiff/D.Hr made several demands to the J.Dr Nos.2 to 4 to discharge the decree debt, but they did not choose to pay any amount. Thereafter, the D.Hr filed the present E.P. for attachment and sale of the E.P schedule properties to realize the decree debt. He further submits that as the E.P schedule proerpty was already attached by the Court below, requests this Court to make attachment order as absolute to proceed further in the E.P.

4. On the other hand, learned counsel for the respondents/J.Drs submits that originally the E.P schedule properties are the ancestral properties of the first respondent. In the family partition they were fell to the share of the first respondent. Subsequently the first respondent during his life time, executed a registered gift deed in faovur of the second respondent on 26.8.2017 and her name was also mutated in the revenue records. Moreover the EP schedule properties does not stand in the name of the first respondent as on the date of passing of decree. He further submits that the attachment was effected on 28.7.2019 and by that date the property does not stand in the name of the deceased first respondent. The second respondent got the property by virtue of registered gift settlement deed and she became absolute owner of the property, but she has not. succeeded any estate of the deceased consequent to the death of the deceased first respondent. He further submits that the petitioner filed E.P. only to harass the J.Drs. and hence prayed to raise the attachment and dismiss the E.P.

5. After careful consideration of the documentary evidence and on perusing entire material available on record and also the citations which were filed by the parties, the Court below dismissed the E.P. on the ground that the petitioner/D.Hr is not entitled to proceed against the E.P. schedule property to realize the decree debt. Challenging the same, the present CRP has been filed by the petitioner/plaintiff.

6. This Court vide order dated 02.11.2020 while issuing notice before admission, granted interim direction to the respondents not to sell or alienate in any manner the property which has been attached on 28.07.2019 for a period of six weeks and thereafter it was extended from time to time.

7. During hearing, learned counsel for the petitioner has placed reliance on a decision of Hon’ble Supreme Court reported in Dayanandan, minor, by mother and guardian Saradambal and another v. Venugopal Naidu, 1963 SCC OnLine Mad 155, wherein it was held that :

“Section 128 of the Transfer of property Act fastens a personal liability upon the universal donee for all debts due by the donor at the time of the gift though that liability is confined to the extent of the properties comprised in the gift. This aspect, if 1 may say so with respect, again, does not appear to have been kept in view in AIR 1952 Trav. Co. 23. The liability or the universal donee to pay the decree debt of the donor arises not only by reason of the donee accepting the gift and of being the legal representative of the dece

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