Presented By

y y y y

Saqib Ali Abbas Roll No MI06BBA063 BBA- Irm 4th Semester

ABDULLAH FARHAN
y MIO7BBAO28

And the first to lead the way, of the Muhajireen and the Ansar And those who followed them in goodness - Allah is well Pleased With them and they are well pleased with Him, and He Hath made Ready for them Gardens underneath which rivers Flow, wherein They will abide forever. That is supreme triumph.1

1Al-Quran Surah At-Tawba, 9: 100

Introduction
y Islam is neither simply a religion nor a mere ideological vision. y It is a Comprehensive religion and a practical system of life that covers every single aspect of human life. In Islam y The development of ummah is the priority in the economic system and therefore Islam strongly encourages people to involve in business or to be an entrepreneur y An entrepreneur will be dealing with a lot of commercial activities which falls under various types of contract

Evolution of Islamic law of contract

y It starts with al-Quran which already prescribes several types of nominate contract

as well as certain general contractual maxims

y Thereafter, the traditions or al-Sunnah supplement the Quranic groundwork as a

support or additional explanation to its general provision

y In al-Quran, there are only over forty verses out of 6666 verses on a dozen types of

commercial contract

O you who believe! When you borrow from one another a debt for a fixed term, and then write it down. Let a scribe write it down in justice between you, and the scribe should not refuse to write as Allah has taught him, and let him who owes the debt dictate, and he should have Taqwa of Allah his Rabb, and not diminish anything of what he owes, but if he who owes the debt is of low understanding, or weak, or unable himself to dictate, then let his guardian dictate with justice, and let it be witnessed by two witnesses from among your men, and if two men are not available then a man and two women, of such as you approve to be witnesses, so that if one of the two women should the other can remind her, and the witnesses should not refuse when they are summoned, and be not averse to writing it down whether it be small or large, along with its appointed time of payment, that is more just with Allah and stronger as evidence, and the best way of avoiding doubt between you, except when it is a trade that you carry out on the spot among yourselves, then there is no blame on you if you do not write it down, and have witnesses when you sell to one and another, and let no harm be done to the scribe or the witness, and if you do it is certainly a sin on your part, and have Taqwa of Allah, and Allah is teaching you, and Allah is with every single thing All-Knowing.

y And if you are on a journey and cannot find a scribe, then let there be a pledge with possession, but if one of you trusts the other, then he who is trusted should deliver hi trust and let him have taqwa of Allah his Rabb, and do not conceal the testimony, and whoever conceals it his heart is surely sinful, and Allah is with all that you do Knowing

ABDUL REHMAN
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Main Points
y Loans and financial agreements be written down y contract must be written down by a scribe and terms of the contract he must be fair to Both y y y y y y y y y y y y

parties Scribe is called upon he must not refuse this duty Debtor is the one who should dictate to the scribe the terms of the agreement. So even when he is dictating the terms of the contract, he must be fearful of Allah There must also be two witnesses presiding over it And if two men are not available then a man and two women Someone who is trustworthy, who has a good memory, which is not known to tell lies If one of the women should forget or make any mistake, then the other can remind her and correct her And the witnesses should not refuse when they are summoned Muslims should be written down, there are no exceptions date on which the loan is to be returned must be clearly documented When a transaction begins and ends on the spot, then there is no need to record that transaction in writing And if you are on a journey and cannot find a scribe, then let there be a pledge with possession

Explanation
y This is the longest ayah in the Quran. In this ayah, Allah (swt) details for

the Muslims how all loans and financial agreements are to be conducted y Allah (swt) wants fairness and equity to be established between all members of the community in all affairs of life. Even in matters relating to the affairs of this world there must be equity and justice
y Before we begin our discussion of this ayah we should see how this

ayah is a precise legal document. In this ayah Allah (swt) gives specific and detailed rules about how loans and financial agreements are to be conducted. Allah (swt) addresses every possibility that could arise in the formation of these contracts

y He (swt) tells us exactly what must be done should these circumstances

arise. But despite the fact that this ayah is an exacting legal document
y That ability of the Quran to convey a depth of meaning using only a few

words is still present in this ayah despite the fact that it is such a precise legal document. Furthermore while transmitting that deep meaning the beautiful and harmonious tone of the Quran is still present in the ayah despite the fact that is a legal document
y Now if you were to read any legal document that has been written by

any human writer, it would probably be the most boring work you have ever read

y There would be no beauty in the words because it is only a set of dos and

donts, only a set of terms and conditions. But this not so with the Quran, here Allah (swt) has given us the most precise and exact legal document detailing how financial agreements are to be conducted but He (swt) has presented it to us with the beauty and the harmony of words that are found throughout the Quran

RANA FAHAD
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y Before i discuss this ayah i once again have to emphasize that this is

not a tafsir of fiqh. Contract law in Islam is a very detailed subject, so here we are not going to give all the rules here on how contracts should be formed. Such is not the intention of our tafsir. So you should not refer to it as a manual of fiqh to be used in your everyday life. If you desire to know how contracts are to be formed in Islam, i advise you to consult the books of fiqh or a scholar that you know and trust. For our purposes we are only going to give a general overview of this ayah and we are going look for the general guidelines and benefits that we can apply in our lives.

1st Part of Ayah

y Allah (swt) begins this ayah by saying y O you who believe! When you borrow from one another a debt for a

fixed term, and then write it down.

y Here Allah (swt) is telling the Muslims that whenever they loan out money to

each other, or whenever they enter into any kind of financial obligation where they have to pay back each other over a period of time, they should then commit the terms of their agreement to writing. So any kind of agreement where money is borrowed or money has to be exchanged over a period of time must be committed to writing

2nd part of Ayah

y Then Allah (swt) says

Let a scribe write it down in justice between you Once again we see the emphasis on writing, Allah (swt) specifically says that a scribe must be present to write down the agreement between the two parties. Although the debtor or the creditor may themselves be lettered and capable of writing down the contract, Allah (swt) still mandates that a third party has to be present. Thus we see Allah (swt) commands that the contract must be written down by a scribe and terms of the contract he must be fair and equitable to both parties We see the emphasis that Allah (swt) has placed on fairness and equity

3rd part of Ayah

y Then Allah (swt) says

And the scribe should not refuse to write as Allah has taught him Here we see that Allah (swt) is saying that if any scribe is called upon to write this contract between two Muslims, then he must come and write. He cannot refuse when he is called upon to write. Allah (swt) reminds the scribe that it was He (swt) who had taught him to write and given him that ability. So the scribe must be grateful to Allah (swt) and he must not refuse this duty when he is called upon to fulfill it.

SYED SAQIB ALI ABBAS

4th part of Ayah

Then Allah (swt) says, And let him who owes the debt dictate So the debtor is the one who should dictate to the scribe the terms of the agreement. This is because the debtor is the one who is the weaker of the two parties in this agreement. The debtor is the one who owes the money so this contract is against him. The creditor on the other hand has the power because the money belongs to him and the contract is supporting him. From this we can once again see the Love and Mercy that Allah (swt) has for the weak in the society.
he should have taqwa of Allah his Rabb, and not diminish anything of what he owes So even when he is dictating the terms of the contract, the debtor must always remember Allah (swt), he must be aware of Allah (swt) and he must be fearful of Allah (swt). Because of this fear of his Lord he must not cheat the creditor of anything that is rightfully his Another lesson that we can take from this ayah is to see how whenever Allah (swt) gives us commands links those commands to fear of Him If this taqwa is built into the people and they always remember Allah (swt), just think to yourself how much better the society would be

5th part of Ayah

y In the next part of the ayah Allah (swt) says,

And let it be witnessed by two witnesses from among your men From this part of the ayah we see that it is not enough to simply write down the contract, but there must also be two witnesses presiding over it. We can see from here how many a precaution Allah (swt) is giving us in order for us to avoid conflict between us. How many a precaution Allah (swt) is giving us to ensure that the brotherhood and unity of our Ummah is always maintained Allah (swt) also says in this ayah that the witnesses must come from from among your men. A weak-minded person or a child is not qualified to be witnesses. A non-Muslim cannot be a witness as well. Allah (swt) Knows best!

y In that case, Allah (swt) says

and if two men are not available then a man and two women So here Allah (swt) says that in the case where two Muslim men meeting all of the conditions are not to be found then one Muslim man and two Muslim women may suffice. They will suffice as being witnesses over business contracts. Some ignorant people read this part of the ayah and think that Allah (swt) has discriminated against women because He (swt) has made the testimony of a woman to be equal to half that of a man Allah (swt) has created the woman to fulfill this important role of look after of home and children She may not be physically strong like the man who needs to go out into the world and work

y That is why Allah (swt) first legislated that two men must be called upon to witness the

contract. Men were the ones who were experts in the affairs of the marketplace, and so they knew best about these contracts. It is not because Allah (swt) has shown favor to men over women, as we have already discussed all human beings are the creation of Allah (swt) and He (swt) does not prefer a man over a woman only because he is a man. Even the best and most pious men today do not even come close to the nearness to Allah (swt) that women like Khadija (Ra) and Aisha (Ra) had. The wives of the Prophet (saw) were better Muslims than you and I can ever hope to be. So it is not that men are better than women

y Then Allah (swt) says

such as you approve to be witnesses In this part of the ayah, Allah (swt) tells us that those whom we choose to be witnesses must
only be those whom we approve of being witnesses. So it must be someone who is trustworthy, who has a good memory, which is not known to tell lies, and it must be someone who we can be sure will be impartial and fair to both parties

AQEEL ABBAS

In the next part of the ayah, Allah (swt) says so that if one of the two women shoulders the other can remind her. We already mentioned in a previous part of the ayah how most women were inexperienced with business contracts and financial agreements, so in this part of the ayah Allah (swt) tells us why He (swt) legislated that two women are required to witness over the contract. It is so that if one of the women should forget or make any mistake, then the other can remind her and correct her. They can each support each other and help each other in their role of witnessing over the contract. Then we see Allah (swt) says, And the witnesses should not refuse when they are summoned Here we see Allah (swt) tell us that whenever the witnesses are summoned they should respond and should not refuse to come.

y Then Allah (swt) says

and is not averse to writing it down whether it be small or large Here Allah (swt) tells us that every single loan or debt that is undertaken between Muslims should be written down, there are no exceptions Allah (swt) also says, along with its appointed time of payment. So the date on which the loan is to be returned must be clearly documented. This is where conflicts often arise with debts and loans. that is more just with Allah and stronger as evidence and the best way of avoiding doubt between you. As we said it is human nature to be forgetful. This is how Allah (swt) created us. So Allah (swt) has legislated the presence of these safeguards to prevent us falling from into situations where we would forget and where we would doubt.

except when it is a trade that you carry out on the spot among yourselves, then there is no blame on you if you do not write it down. This is the exception in which a contract would not have to be made. When a transaction begins and ends on the spot, then there is no need to record that transaction in writing. Transaction ended right there, there is nothing further that needs to be recorded and remembered for the future. No one owes anyone else in the future anything as a result of that transaction, all the debts are settled right there on the spot. and let no harm be done to the scribe or the witness, and if you do it is certainly a sin on your part. Allah (swt) specifically says that no harm is to be done either to the scriber the witnesses. Anyone who harms them will be carrying a great sin and have Taqwa of Allah, and Allah is teaching you. Allah is with every single thing AllKnowing This time Allah (swt) reminds us how He (swt) knows every single thing. There is not a single thing that escapes the Knowledge of Allah (swt).

ARQAM HAROON
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And if you are on a journey and cannot find a scribe, then let there be a pledge with possession, but if one of you trusts the other, then he who is trusted should deliver hi trust and let him have taqwa of Allah his Rabb, and do not conceal the testimony, and whoever conceals it his heart is surely sinful, and Allah is with all that you do Knowing
y And if you are on a journey and cannot find a scribe, then let there be a pledge with

possession, but if one of you trusts the other, then he who is trusted should deliver his trust and let him have taqwa of Allah his Rabb, and do not conceal the testimony, and y Whoever conceals it his heart is surely sinful, and Allah is with all that you do Knowing

y Here Allah (swt) tells the Muslims that when they are in a situation where a scribe is not to be

found then they can give a pledge with possession. This is basically something of value that the creditor holds on to as collateral until the debtor returns his loan y This part of the ayah is addressing both the creditor and the debtor; both of them have a trust with the other. The debtor has a trust that he will return whatever it is that he has borrowed, and the creditor has a trust that he will take care of whatever it is that he is holding as collateral y who conceals such a testimony is surely sinful. They are sinful because they are hiding the Truth only to get some material benefits of this world

y We do so many actions from the time that we open our eyes in the morning

till the time that we do to bed at night. We have done so many actions from the time we came out of mothers womb up to this moment in time. Many of these actions that we have done were not witnessed by any person. There are many actions that we do which we ourselves do not know about and there are many other actions that we do that we ourselves forget. In this part of the ayah Allah (swt) reminds us once again that He (swt) knows about every single one of our actions. Allah (swt) Knows very well every single action that we have ever done from the time that we entered this world right up to this very moment in time.

Main Points
y Loans and financial agreements be written down y contract must be written down by a scribe and terms of the contract he must be fair to Both y y y y y y y y y y y y

parties Scribe is called upon he must not refuse this duty Debtor is the one who should dictate to the scribe the terms of the agreement. So even when he is dictating the terms of the contract, he must be fearful of Allah There must also be two witnesses presiding over it And if two men are not available then a man and two women Someone who is trustworthy, who has a good memory, which is not known to tell lies If one of the women should forget or make any mistake, then the other can remind her and correct her And the witnesses should not refuse when they are summoned Muslims should be written down, there are no exceptions date on which the loan is to be returned must be clearly documented When a transaction begins and ends on the spot, then there is no need to record that transaction in writing And if you are on a journey and cannot find a scribe, then let there be a pledge with possession