ABC Ltd., a holding company in India, is undergoing liquidation. It owns 80% of the shares of XYZ Pvt. Ltd. Bengaluru and also 60% of Global Tech Inc., San Jose, USA.

Since the shares in XYZ Pvt. Ltd. and Global Tech Inc. are owned by the corporate debtor, they constitute financial assets and form part of the liquidation estate and may be realized by the liquidator for distribution among stakeholders. Financial assets, including shares and financial instruments owned by the corporate debtor, form part of the liquidation estate [Section 36(3)(d) of IBC]. However, the underlying assets of these subsidiaries cannot be included in liquidation, as the same is excluded being assets of separate legal entities [Section 36(4)(d) of IBC].