# In the matter of Virtual Logic Systems Private Limited

> NCLT judgment dated 2020-08-24. Citation: TCN-2020-NCLT-00788. The case involves an application (I.A. No.274 of 2020) filed in connection with a corporate…

- **Court:** NCLT
- **Order date:** 24 Aug 2020
- **Citation:** TCN-2020-NCLT-00788
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/virtual-logic-systems-private-limited-1cbfcb99

## Summary

### Background

The case involves an application (I.A. No.274 of 2020) filed in connection with a corporate insolvency resolution process (CIRP) initiated against M/s. Virtual Logic Systems Private Limited (Corporate Debtor) under C.P. (IB) No.126/BB/2017. The CIRP was initiated by Mr. K.S. Hiremath, an operational creditor, due to a default of Rs. 10,63,750. Mr. Venkata Subbarao Kalva was appointed as the Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional. The Committee of Creditors (COC) approved the initiation of liquidation as no viable resolution plan was received. The liquidator then sought orders for the distribution of unsold intangible assets, specifically intellectual property, to Technology Development Board, a secured financial

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## Facts

Mr. K.S. Hiremath, an operational creditor, initiated Corporate Insolvency Resolution Process (CIRP) against M/s. Virtual Logic Systems Private Limited (Corporate Debtor) under Section 9 of the IBC, 2016, due to a default of Rs. 10,63,750. Mr. Venkata Subbarao Kalva was appointed as the Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional. The Committee of Creditors (COC) approved the initiation of liquidation. The liquidator filed I.A. No.274 of 2020 seeking orders for the distribution of unsold intangible assets (intellectual property) to Technology Development Board (TDB), a secured financial creditor. The intangible assets included software such as Marga-Laparoscopic Surgery Training Simulator, Dissect- Human Anatomy

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## Issues and analysis

### Issue 1: Whether the Applicant is permitted to assign absolute rights over Unsold Intangible Assets- …

**Ratio:** Section 54(2) of the Insolvency and Bankruptcy Code, 2016 read with Regulation 14 of the

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**Reasoning:** The court reasoned that the assets of the Corporate Debtor had been completely

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**Interpretation:** This issue involves the interpretation of the powers of the Adjudicating

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**Application:** The court applied the ratio to the specific facts of the case, noting that the

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## Parties

- **Judges:** Rajeswara Rao…; Ashutosh C…
- **Appellants:** Venkata Subbarao…
- **Respondents:** M/s. Virtual…

## Timeline

- **2017-01-01 — Initiation…**: C.P. (IB) No.126/BB/2017 filed by Mr. K.S. Hiremath under Section 9 of the IBC, 2016,…
- **2018-01-22 — Admission o…**: Adjudicating Authority…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 36 — Liquidation estate](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-36)

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