Modern Application of Ijarah

Forward ijÉrah is a newly introduced financing tool used for different financial services by individuals and Islamic financial institutions (IFIs). IFIs currently provide a financing product for home under construction based on the mushÉrakah mutanÉqiÎah partnership (MMP) whereby forward ijÉrah is applied as a sub-contract. There is a consensus on legality of forward ijÉrah. The parameters of forward ijÉrah are constituted from rules of both ijÉrah and salam. Forward ijÉrah is allowed to be used along with other valid contracts in hybrid mode as long as it fulfills the criteria put forward by scholars. The book also shows that although usufruct is not a valuable asset in its originality according to ×anafÊ School, usufruct of ijÉrah is excluded from being a valueless asset on the basis of exception regardless of whether it is ijÉrah of a particular object or usufruct in liability. In addition, if the rental is fixed it comes out of being debt in liability, albeit it is not handed over. Therefore, immediate payment is not obligatory in forward ijÉrah. The issue that contradicts SharÊÑah principle is that the bank does not bear any risk; rather, it considers the rental paid by customer for forward ijÉrah during the construction period as the compensation for the failure of istiÎnÉÑ, and the customer also cannot charge the developer for abandoned house. The possible solution for the issue is that the bank should share the risk according to its portion in partnership as well as the customer can refer to the developer to charge the compensation for his actual failure in istiÎnÉÑ. Therefore, the provision(s) should be added in the law of Islamic banking and finance that binds the developer to compensate the customer for his actual default.

ISLAMIKA

Ijarah is a contract on the transfer of goods or services with rewards instead. Ijarah based transactions with the displacement benefit (rights to), not transfer of ownership (property rights), there ijara financing translates as buying and selling services (wages hired), that take advantage of human power, there is also a translate lease, which take advantage of goods. Application ijarah growing financial institutions in the current Shari'ah is happening on the leasing company (financial institution based on Islamic teachings, as well as Islamic banking is one of the products in Islamic finance. Application ijarah emerging financial institutions shari'ah 'ah at the moment that is happening on the leasing company (financial institution based on Islamic teachings, as well as Islamic banking is one of the Islamic financing products). This research is a library research (library research) and field research (field research), and is descriptive, analytic and comparative. Dat...

Islamic Economic Studies, 2016

Fiqh, indicating Islamic law and the means to produce it, covers all aspects of human dealings, including Islamic financial law and its Shariah nominated contracts, which represent the bases for all Islamic banking and finance transactions. These contracts are either readily found in the classic books of Islamic law or modified versions adopted to suit the modern transactions of Islamic finance. In some cases they are a combination of more than one contract designed to serve a particular financing purpose, like the contract of Ijarah Muntahia Bittamlik where the transaction starts with lease and ends with sale. This paper comes to discuss the most important Ijtihad instruments that can be used by the Faqih to evaluate and endorse products in Islamic finance. It then elaborates on the instruments that are in use in the modern Islamic finance and which reflect a departure from Shariah rules and tools for Ijtihad. The objective of this paper is to shed light on the cotemporary Ijtihad in Fiqh of Finance in light of the guidelines provided by the Shariah in an attempt to draw the outlines of what constitutes a proper use of proper Ijtihad instruments in Islamic finance.

Al-IjÉrah Al-MawÎËfah FÊ Al-Dhimmah (forward ijÉrah) is a new form of transactions introduced to the Islamic banking industry which has original ground in the classical books of Islamic Jurisprudence. Most of the classical scholars discussed it with particularized ijÉrah in parallel without any separation of chapters or headings unlike al-BahËtÊ and al-MinhÉjÊ. The scholars of four schools of Islamic Law are unanimously agreed on the legality of forward ijÉrah albeit some contemporary scholars mention the early dispute in this regard and attribute prohibition of forward ijÉrah to ×anafÊ School. This attribution is not accurate as it is proved by their many classical texts. Forward ijÉrah could be more flexible for both customers and banks to the extent that it does not become void if the stipulated usufruct damages while particularized ijÉrah becomes void because of damage of the object. Therefore, there is a need for further research in this regard in order to innovate some new tools that can improve the services of Islamic financial intuitions.

AL-IHKAM: Jurnal Hukum & Pranata Sosial, 2019

Ijârah begins from the concept of classical fiqh as a transaction that sustains the development of Islamic banking. The wide range of banking products produced from the concept of ijarah is the basis for developing the concept of jurisprudence from classical fiqh contact to banking products in the form of financing. These developments can be seen from a large number of banking products that use ijârah contracts, especially those related to services. This development lies in the merger of ijârah contracts with several other contracts such as wakâlah. Another development that exists in the path to ijarah financing is seen from the foundation. In classical fiqh concept, ijârah is a product of fiqh ijtihâd which is ẓanni or not binding. Every Muslim may practice the concept of jurisprudence from many scholars as ijtihâd. However, in the financing of the surcharge, it is a combination of several contracts and is based on the DSN-MUI fatwa which is more binding for Islamic financial institutions on the recommendation of the Islamic banking law.

rdis.ir

The absence of bonds in the capital market and the capability of Islamic contracts in designing of new financial instruments have come to different Islamic financial instruments as sukuk be proposed by the Islamic financial experts. However, although they all lack of those required jurisprudential and economic criteria, few of them have a high operational and economic feasibility in compliance with Islamic jurisprudential rules.

Journal of Islamic Finance

The operating ijarah and ijarah financing are currently generating interest among the Islamic banks, investors, customers and even policy makers due to their less risk overloads and better profits to the public. This paper attempts to highlight the benefits of applying the Islamic legal objectives (Maqasid Al-Shari'ah) in ijarah contract, and how a strict compliance to the latter can help manage Shari'ah, business and distribution of wealth in the society. The paper discusses the impact of Muslim scholars in applying ijtihad and analogical deduction to fashion out the appropriate ruling in respect of the issues, by putting into consideration what would be the best interest of Islam and Muslim community as a whole. It also discusses the consent of the contracting parties as one of the conditions validating the ijarah contract, and as a supplement to the objective of avoiding injustice and embezzlement of another person's wealth. The paper explains how the profit made and the risks incurred, if any, are shared between the parties involved in ijarah transaction which are proportionally shared according to what has been earlier agreed upon.

Contemporary Islamic Finance has evolved over the recent past to meet economic and financing challenges faced by the Muslim societies, and to regulate the Islamic banking system under Sharī‛ah. Islamic Banks are practicing and introducing various products and instruments such as mushārakah, mudārabah, murābahah, ijārah, salam and istisnā‛, the innovations of classical fiqh contracts molded into complex banking products. Islamic banks standardize their products with the help of their fatāwā committees. This is sometimes criticized as talfīq, a mere patchwork rather than a proper integration of juristic opinions. Talfīq by "qualified jurists" in "issues pertaining to the interests of people and their happiness", is categorized as permissible. -Editors.]

ADDIN

The purpose of this study was to examine and analyze the implementation of the Ijarah Muntahiya bi at-Tamlik contract in the conception of Luzumu al-‘Aqdi. The approach method used in this research was sociological juridical. The results of this study indicated that the implementation of the Ijarah Muntahiya bi at-Tamlik contract at Bank Syariah Indonesia (Indonesian Sharia Bank, BSI) Semarang Branch Office in the concept of Luzumu al-‘Aqdi actually shows the occurrence of legal uncertainty. This is because the implementation of the Ijarah Muntahiya bi at-Tamlik contract should only be carried out through buying and selling, not grants. The implementation of the Ijarah Muntahiya bi at-Tamlik contract can only use a sale and purchase contract because this contract is part of the ijarah contract which aims to obtain profit or profit, while the grant contract is one of the tabarru’ contracts which aims to help each other and seek the pleasure of Allah alone. Besides that, implementatio...

This article examines issues surrounding the historiography of ijtihad within the context of Islamic law. It considers the politics informing debates about whether the " gates " were ever closed, and what " closure " implies about Islamic law. It then discusses calls for the " reopening " of the " gates " , suggesting that such calls seem to reflect more about the conditions of modernity that pose new questions to a tradition with a considerable history, and less about the study of Islamic law. It also reviews the scholarship on ijtihad as a topic of legal theory in the usul al-fiqh genre and in relation to contemporary issues in legal philosophy and interpretation, along with the discourse of ijtihad in the modern period and its significance as a proxy for underlying concerns about epistemology, legal education, and authority. Finally, it outlines new scholarly directions for research on ijtihad. The topic of ijtihad has occupied researchers of Islamic law for decades if not centuries. Moreover, polemicists and reformists in more popular venues invoke it to question the relevance and ongoing significance of Islamic law in the world today. This essay will canvass a range of issues pertaining to the historiography of ijtihad. It will start by addressing the highly fraught concept of the " gates of ijtihad " and the debates about whether the " gates " were ever closed, what " closure " implies about Islamic law, and how calls for its " reopening " seem to reflect less about the study of Islamic law and more about the conditions of modernity that pose new questions to a tradition with a considerable history. Thereafter, the essay will explore the scholarship on ijtihad as a topic of legal theory in the usul al-fiqh genre, and the intersection of that discussion with contemporary issues in legal philosophy and interpretation. The essay will then turn to the discourse of ijtihad in the modern period, and its significance as a proxy for