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Resolutions of Iftaa' Board

Resolution No.(53): “ Ruling on Awards Offered by the Islamic Bank in Accordance with a Particular Mechanism“

Date Added : 02-11-2015

 

Resolution No.(53): "Ruling on Awards Offered by the Islamic Bank in Accordance with a Particular Mechanism“

Date: 8/8/1422 AH corresponding to 24/10/2001 AD

 

The Board recieved the following question:

What is the ruling when the Islamic Bank offers incentive awards to clients, who have investment accounts, in accordance with a particular mechanism (volume of the account, duration, added sums, and stability of the account)? How can we define the relation between the above clients and the Islamic Bank in light of these awards: a contract or an independent initiative on the part of the bank? If it is a contract, is it binding or not?

Answer: All success is due to Allah.

The Board of Iftaa` is of the view that it is permissible for the executive board of the Islamic Bank to distribute cash or in-kind incentive awards on these clients, and to cover their expenses in Hajj (pilgrimage) or Umrah (minor pilgrimage) or the like, if it is entitled to do so, provided that these awards are covered from the bank`s own earnings.

Moreover, it is impermissible for the bank to cover these awards from the total of the investment profits because this entails giving a portion from the share of the owners of these accounts as a sort of contribution, and this is forbidden in Sharia because the Mudarib (bank) isn`t allowed to give from the money of the Mudarabah (co-partnership), except with the permission of the owners (clients who have investment accounts). If they allow that, then it is permissible for the bank to cover these awards from its overall profit. In this case, offering these awards is considered a donation/grant on the part of the bank, and becomes a binding promise if it had made an announcement about that earlier. In addition, it can`t be considered a condition in the Mudarabah contract between the bank and the owners of the investment accounts because some of them may receive awards; whereas, others may not.

In this case, the board of directors enjoys the authority to lay down the legal terms and regulations pertaining to giving these awards (volume of the account, duration, added sums, and withdrawals), and to determine the type of the investment account (savings, deferred etc.) eligible for that, whether to all clients or to some of them.

Moreover, it isn`t permissible for the bank to distribute these awards on the owners of credit accounts (current accounts) for there is a suspicion of Riba (usury) similar to the ruling on loans because every loan that leads to a benefit is unlawful.

Based on the aforementioned, it is obvious that the relation between the Islamic Bank and the investors in light of these awards isn`t contractual, rather, it is an individual initiative undertaken by the free will of the Bank`s Administration. And Allah Knows Best.

Iftaa` Board
Chairman of the Iftaa` Board, Chief Justice, Izz Al-Deen Al-Tamimi
            Dr. Mohammad Abu Yahia
           Dr. Abdulsalam Al-Abbadi
    Dr. Yousef Gheezaan
Dr. Wasif Al-Bakhri
   Sheikh Saeid Hijjawi
        Sheikh Na`eim Mojahid

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Summarized Fatawaa

What is the amount of food to be given to a needy person for fidyah and kaffarah?

The amount of food to be given to a needy person is 600 grams of wheat or rice.
According to the Hanafi school, it is permissible to give the monetary equivalent instead, and this is the ruling issued by the General Iftaa` Department.

What is the Sharia basis of the Udhiyah?

Praise be to Allah, and peace and blessings be upon our Master, the Messenger of Allah.
The Sharia basis of the Udhiyah (sacrificial offering) is firmly established through the Quran, the Sunnah, and the Consensus (Ijma') of the Muslims:
1. Evidence from the Holy Quran
Allah the Exalted says {what means}: "And the camels and cattle We have appointed for you as among the symbols of Allah; for you therein is good." [Al-Hajj/36]. He also says {what means}: "So pray to your Lord and sacrifice [to Him alone]" [Al-Kawthar/2]. According to the most well-known scholarly interpretations of this verse, "prayer" refers to the Eid prayer, and "sacrifice" refers to the slaughtering of the Udhiyah.
2. Evidence from the Sunnah
Al-Bara' bin 'Azib (may Allah be pleased with him) narrated that the Prophet ﷺ said: "The first thing we start with on this day of ours is to pray, then we return and sacrifice. Whoever does that has followed our Sunnah, and whoever slaughters before [the prayer], it is merely meat he has provided for his family; it is not part of the ritual sacrifice in any way" [Reported by Bukhari & Muslim].
Anas (may Allah be pleased with him) narrated: "The Prophet ﷺ sacrificed two white rams with horns. He slaughtered them with his own hand, mentioned the name of Allah (Tasmiyah), and said the Takbir" [Reported by Bukhari & Muslim].
3. Evidence from Scholarly Consensus (Ijma')
The Muslims have reached a unanimous consensus on the Sharia basis of the Udhiyah, and no one among the scholars has disagreed with this. [Al-Sherbini, Mughni al-Muhtaj, Vol.6/P.122].And Allah the Exalted knows best.

What is the ruling on someone who curses the religion or commits an act of disbelief during the day in Ramadan?

Whoever apostatizes (leaves Islam) while fasting, their fast is invalid. Cursing the religion is an act of apostasy (may Allah protect us from it). Such a person must return to Islam by pronouncing the Shahadah (testimony of faith), seek Allah’s forgiveness, refrain from eating and drinking for the rest of the day, and make up for that day’s fast later.

What is Aqeeqah?

It is the sheep slaughtered on the seventh day from the child`s birth, and it is a confirmed Sunnah after the Prophet (PBUH).

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