The concept and legitimacy of Rahn (pledge) in financial contracts have been established by a number of Quranic texts (2: 282) and the Sunnah (Bukhari Sahih). Rahn (Pledge) is defined as the security for the satisfaction of creditors in respect of debt on part of a debtor.
Being the student of Islamic Jurisprudence in Islam, discuss the validity of the following situations:
Mr. Bilal pledged the documents of an immovable property against debt taken from Skill bank limited.
Mr. X provided a loan to Mr. Z with a condition that Mr. Z would allow Mr. X to use his car as a fulfillment of pledge for a loan.
Mr. Ali Hassan provided a loan to Mr. Jamal of Rs. 5 Million against gold as Rahn (pledge) with market value equals to the debt amount. After 6 months the market value of the gold becomes Rs 6 million. However, without any negligence, Mr. Ali lost all the gold in a robbery at his home. In light of Sharia’h school of thoughts, briefly discuss the impact of the loss of subject matter on the obligation of both parties.
SEMESTER FALL 2019
FINANCIAL JURISPRUDENCE IN ISLAM (BNK612)IMPORTANT:
DUE DATE: 02ND DECEMBER, 2019 MARKS: 10
The objective of this assignment is to enable the students to understand the forms of Fraud in Islamic Sharia’h.
Under Islamic Sharia’h, apart from Riba, Gharar and Maysir; Fraud causing misrepresentation is also forbidden in business transactions. Muslim jurists have discussed various types of fraud/deception, which make the contract voidable on part of buyer. Consider the following situations and answer the given questions.
A butcher used to sell the meat after excessive watering in order to increase weight and to give impression of fresh meat.
A real estate agent while dealing with his potential client deliberately bid for 15 million for a house which is higher than the market value. To give the impression of fair dealing, two of his agents deliberately offered 15.5 million to induce the client to pay higher than the actual market price.
Keeping in view the types of Fraud in Islamic Jurisprudence laws, answer the following questions
i. Briefly explain what type of Fraud is involved in above mentioned cases?
ii. What is the legal status of the transactions caused by such deception and fraud? Also discuss the view of
all four schools of thought (Hanafi, Hanbali, Shafai, Maliki) on the given scenario?
iii. In order to give the innocent party right to revoke the transaction, what conditions should be fulfilled to
prove an act of fraud?
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