A process for converting heavy oils in to lighter hydrocarbons said process comprising the steps of: (a) heating a mixture comprising heavy oil feed, Heavy Vacuum Gas Oil (HVGO) recycle feed stream, hydrogen and an oil soluble liquid catalyst in a heater; (b) transferring and charging the mixture of step (a) in a tubular slurry hydrocracking reactor at temperature in the range of 250°C to 550°C, pressure in the range of 40 to 250 bar and a liquid hourly space velocity below 4 h -1, wherein the oil soluble liquid catalyst gets sulphided and heavy oil gets hydrocracked during the course of reaction; (c) obtaining and transferring gas-liquid mixture of step (b) to a hot high pressure separator; (d) separating the gas-liquid mixture of step (c) into (i) first gaseous stream of hydrocarbons which is free of oil soluble liquid catalyst having boiling point up to 500°C and (ii) second liquid stream of hydrocarbons containing oil soluble liquid catalyst having boiling point above 500°C which contains Heavy Vacuum Gas Oil (HVGO) and Unconverted oil; (e) extracting the second liquid stream of hydrocarbons of step (d) and transferring to a hydrocyclone separator and separating it into (i) a first part consisting of liquid portion consisting of HVGO and Unconverted oil having a boiling temperature in the range of 500-525°C, the HVGO containing oil soluble liquid catalyst particles of size less than 20 micron with high concentration of aromatic compounds; and (ii) second portion consisting of pitch having a boiling point of above 525°C containing particles of oil soluble liquid catalyst of size more than 20 micron which is purged out; (f) transferring the first portion consisting the HVGO and Unconverted oil of step (e) to vacuum distillation column to obtain (i) Vacuum Gas Oil, HVGO which is recycled to heating mixture and subsequently to slurry hydrocracking reactor, and pitch which is purged out; (g) transferring first gaseous stream of hydrocarbons of step (d) to first hydrotreating reactor comprising hydrotreating catalyst in the temperature range of 200°C to 600°C and in pressure in the range of 20 bar to 90 bar, optionally along with additional hydrogen; (h) extracting the stream of step (g) through line, mixing it with VGO and transferring it to hydrocracking reactor; (i) transferring the effluent of step (h) to High Pressure Separator; (j) obtaining gaseous stream rich in hydrogen and a liquid hydrocarbon product from step (i), wherein gaseous stream rich in hydrogen is drawn off through the overhead line and wherein a liquid hydrocarbon product is drawn off the bottom through line; (k) transferring the liquid hydrocarbon product of step (i) to a product fractionator; and (l) obtaining premium quality streams of C 4, naptha, diesel and VGO, wherein VGO is recycled to fixed bed hydrocracking reactor after mixing with hydrotreating reactor effluent line. (a) heating a mixture comprising heavy oil feed, Heavy Vacuum Gas Oil (HVGO) recycle feed stream, hydrogen and an oil soluble liquid catalyst in a heater; (b) transferring and charging the mixture of step (a) in a tubular slurry hydrocracking reactor at temperature in the range of 250°C to 550°C, pressure in the range of 40 to 250 bar and a liquid hourly space velocity below 4 h -1, wherein the oil soluble liquid catalyst gets sulphided and heavy oil gets hydrocracked during the course of reaction; (c) obtaining and transferring gas-liquid mixture of step (b) to a hot high pressure separator; (d) separating the gas-liquid mixture of step (c) into (i) first gaseous stream of hydrocarbons which is free of oil soluble liquid catalyst having boiling point up to 500°C and (ii) second liquid stream of hydrocarbons containing oil soluble liquid catalyst having boiling point above 500°C which contains Heavy Vacuum Gas Oil (HVGO) and Unconverted oil; (e) extracting the second liquid stream of hydrocarbons of step (d) and transferring to a hydrocyclone separator and separating it into (i) a first part consisting of liquid portion consisting of HVGO and Unconverted oil having a boiling temperature in the range of 500-525°C, the HVGO containing oil soluble liquid catalyst particles of size less than 20 micron with high concentration of aromatic compounds; and (ii) second portion consisting of pitch having a boiling point of above 525°C containing particles of oil soluble liquid catalyst of size more than 20 micron which is purged out; (f) transferring the first portion consisting the HVGO and Unconverted oil of step (e) to vacuum distillation column to obtain (i) Vacuum Gas Oil, HVGO which is recycled to heating mixture and subsequently to slurry hydrocracking reactor, and pitch which is purged out; (g) transferring first gaseous stream of hydrocarbons of step (d) to first hydrotreating reactor comprising hydrotreating catalyst in the temperature range of 200°C to 600°C and in pressure in the range of 20 bar to 90 bar, optionally along with additional hydrogen; (h) extracting the stream of step (g) through line, mixing it with VGO and transferring it to hydrocracking reactor; (i) transferring the effluent of step (h) to High Pressure Separator; (j) obtaining gaseous stream rich in hydrogen and a liquid hydrocarbon product from step (i), wherein gaseous stream rich in hydrogen is drawn off through the overhead line and wherein a liquid hydrocarbon product is drawn off the bottom through line; (k) transferring the liquid hydrocarbon product of step (i) to a product fractionator; and (l) obtaining premium quality streams of C 4, naptha, diesel and VGO, wherein VGO is recycled to fixed bed hydrocracking reactor after mixing with hydrotreating reactor effluent line.