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Resolutions of Iftaa' Board

Resolution No.(49) "Ruling on Financing the "Diminishing Partnership" Offered by the Central Bank to its Employees"

Date Added : 16-12-2015

Resolution No.(49): "Ruling on Financing the "Diminishing Partnership" Offered by the Central Bank to its Employees"
Date: 24/4/1422 AH, corresponding to 15/7/2001.

What is the ruling of Islamic Sharia on the diminishing partnership system offered by the Central Bank to its employees?

Answer:

All perfect praise be to Allah, The Lord of The Worlds; and may His blessings and peace be upon our Prophet Mohammad and upon all his family and companions.

Over several sessions, the Board has reviewed the above issue and arrived at the following view:

Employees of Islamic banks and others can obtain dwellings by one of the following formulae:

First: Murabaha in favor of the purchaser where the employee covers the costs of the construction team; whereas, the bank covers the cost of materials which can be bought through the Murabaha transaction so that they become possessed and guaranteed by the bank. This formula can be employed for purchasing a flat or a building in line with the rules of Murabaha.

Second: Istisna` (making on customer`s order). Here, the bank provides the needed financing in line with the conditions of this form of transaction whereby a flat or a building could be built.

However, the formula, in the above question, presented to the Iftaa` Board: "The Diminishing Partnership" and the attached contract differ from a similar contract that had been approved by the Board where the law had defined it as: (The bank participates as a financing partner- partially or completely-in a project of an expected income on basis of agreeing with the other partner that the bank receives a percentage from the net of the actual income while maintaining the right to keep the remaining part of the profit or some of it, to be agreed upon, to cover the original amount of financing it had provided.) 

In other words, the income of the project, which is based on the aforementioned contract, is the one expected upon the conclusion of the contract itself and the determiner of the expected income is the market, after the completion of the project.

First: it isn`t permissible to estimate that revenue in relation to the financing amount provided by the bank, which settles it on basis of the diminished interest, as is the case of the contract presented to the Board. From the perspective of Sharia, that interest is unlawful although it is low.

In order for this formula to become valid, it isn`t correct to calculate the expected revenue in the manner mentioned above; rather, it should be left to the market.

Since the employees desire to have dwellings for residence and since these won`t be offered for leasing, then the Sharia alternative is that a committee of trustworthy and honorable experts estimate the rent of similar premises after the project is finished based on  actual estimation of the prices of similar houses and flats. In conclusion, it is imperative that the contract is rewritten on the basis that draws a distinction between the acceptable and the unacceptable form in Sharia, this is of course if the employee and the bank wish to resort to the above formula "The diminishing partnership", or they can simply resort to other formulae mentioned above. And Allah Knows Best.

 

Chairman of the Iftaa` Board, The Supreme Judge, Sheikh Izuldeen At-Tamimi

Dr. Abdulsalam Al-Abbadi

  Dr. Yousef Ghyzan

Dr. Wasif Al-Bakri

Sheikh Saeid Hijjawi

Dr. Abdulaziz Al-Khayat

Sheikh Na`eim Mujahid

  Dr. Mahmoud Abu Yahia

Sheikh Mahmoud Shewayat

 

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Summarized Fatawaa

What is the ruling on a second congregation [being formed] in the mosque?

All praise is due to Allah, and peace and blessings be upon our master, the Messenger of Allah ﷺ.
It is disliked to deliberately seek to establish a second congregation in a mosque that is not one frequented by transient passersby — such as a neighborhood mosque with a regular, appointed imam — unless permission is granted by that imam, since doing so implies criticism and an affront to him. However, if the mosque is one frequented by transient passersby — such as mosques located in marketplaces — then a second or even third congregation is permissible there, whether or not it has a regular, appointed imam, and whether or not that imam gives his permission. This is because such mosques experience a continuous flow of people coming and going, so no implication of criticism toward the imam is perceived in the formation of multiple congregations in that setting. And Allah, the Exalted, knows best.

What is the ruling on combining (jam‘) and shortening (qaṣr) prayers when travel is repeated on a daily basis?

All praise is due to Allah, and peace and blessings be upon our master, the Messenger of Allah ﷺ.
A traveler is permitted to avail himself of the concessions of shortening and combining prayers once the distance of his journey reaches (81 km) or more. This is on condition that his journey is a permissible one, and that he begins shortening and combining only after setting out and passing beyond the built-up limits of the city in which he resides, or beyond the administrative boundaries of the area where he lives.
Accordingly, if the distance between one's workplace and one's place of residence reaches the distance upon which the concession of combining and shortening depends, then combining and shortening are permissible once he leaves the built-up area, even if this travel is repeated on a daily basis.
Ash-Shirbīnī (raḥimahullāh) said: "It is permissible to combine Ẓuhr and ‘Aṣr, either as an early combination (taqdīm) in the time of the first, or as a delayed combination (ta'khīr) in the time of the second; and likewise Maghrib and ‘Ishā' — either early, in the time of the first, or delayed, in the time of the second — during a long, permissible journey, in following [the Prophet's practice]. As for the delayed combination, it is established in the two Ṣaḥīḥs from the ḥadīth of Anas and Ibn ‘Umar (raḍiyallāhu ‘anhum). As for the early combination, Ibn Ḥibbān and al-Bayhaqī graded it ṣaḥīḥ from the ḥadīth of Mu‘ādh, and at-Tirmidhī graded it ḥasan." [Quoted with slight abridgment from Mughnī al-Muḥtāj, Vol.1/p.529]
The conditions for combining and shortening have already been explained in Fatwa No. 14 and Fatwa No. 842. And Allah, the Exalted, knows best.

How is night prayer offered?

Night prayer is offering voluntary prayer after Maghrib and before Fajr (Dawn). As for Tahajjud, it is offering voluntary prayer at night after waking up voluntarily, and for Allah`s sake as He Says (What means): "And pray in the small watches of the morning: (it would be) an additional prayer (or spiritual profit) for thee: soon will thy Lord raise thee to a Station of Praise and Glory!" [Al-Isra`/79]. Offering Tahajjud is better than offering voluntary prayer before going to bed.

What are the valid excuses for abstaining from congregational prayer in the mosque?

 
Praise be to Allah, and peace and blessings be upon our Master, the Messenger of Allah.
 
Concessions (Rukhsah) are granted to abstain from congregational prayer in the mosque due to general excuses, such as: rain that causes hardship in going out, strong winds at night, heavy mud that cannot be traversed without the risk of soiling oneself, hot winds, and extreme heat or cold. There are also specific individual excuses, such as: illness that makes walking as difficult as walking in the rain, severe drowsiness, evident hunger or thirst, the suppression of bodily wastes (urine, stool, or gas), and fear for one's life, limb, physical faculty, wealth, or honor, among other valid excuses. And Allah the Exalted knows best.

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