According to the Shariah, the definition of riba is: “Every excess which
does not have a tangible item (of exchange) as its equivalent.” Hence,
if a loan of R100 yields a return of R110, the excess of R10 has no tangible
or material commodity as its equiva- lent. The R100 repayment is in lieu of the
R100 loan, but the R10 has no material commodity to offset it, hence this excess
in the Shariah is riba. Conceding this basic principle, Hadhrat Mufti Saheb says: “First
of all, any additional amount charged from a debtor is riba.” Making a
startling concession which knocks out the very bottom of his opinion of the permissibility
of the riba penalty, Hadhrat Mufti Saheb says: “In the days of jahiliyyah
(before Islam) the people used to charge additional amounts from their debtors
when they were not able to pay at the due date.The aforementioned suggestion
of paying compensation to the creditor/seller resembles the same attitude.”



HADHRAT MUFTI SAHEB’S ARGUMENT

After dismissing the payment of compensation idea of “some con- temporary
scholars”, Hadhrat Mufti Saheb presents his view as fol- lows: “The
question now arises as to how the banks and financial institutions may solve
this problem (i.e. the problem of defaulters). If nothing is charged from the
defaulters, it may be a greater incentive for a dishonest person to default
continuously.”

In practice, continuous default is not allowed by the banks. They are very
quick to resort to legal steps to claim their rights. It is, therefore, not
at all in the interests of the debtor to unnecessarily default in pay- ment.
He will unnecessarily bring upon himself the yoke of exorbi- tant legal costs.

This question had arisen 14 centuries ago while the Shariah was be- ing revealed
to Rasulullah (sallallahu alayhi wasallam). It is not a new question. It is
not a new situation for which Islam has no an- swer. It is not a question,
the solution of which requires the operation of principles of the Shariah for
the formulation of a hukm. The solu- tion for this problem is nothing other
than the pressure of Islam’s moral precepts. While acknowledging the
existence of this problem, Rasulullah (sallallahu alayhi wasallam) addressed
it by saying: “The procrastination of the wealthy (i.e. the one who can
afford to pay) is zulm.”

The very fact that the Aimmah-e-Mujtahideen and the Fuqaha of the Ummah throughout
the history of Islam never employed this Hadith or any other similar narration
as a principle on which to base permis- sibility for a monetary penalty should
be ample indication for us to understand that there is no scope in the Shariah
for a monetary pen- alty to punish the debtor for his act of procrastination.
In fact, the Fu- qaha did not invoke any principle of the Shariah to acquire
a hukm of monetary penalty. The simple and straightforward reason for this
is that a monetary penalty is riba, plain and simple. In addition it is in
conflict with the moral exhortation of the Qur’aan and Sunnah.

Neither did Rasulullah (sallallahu alayhi wasallam) nor the Sahaa- baha nor
the Aimmah-e-Mujtahideen nor the Fuqaha-e-Mutaqaddi- meen nor the Fuqaha-e-Muta-akh-khireen
impose a monetary penalty to solve this problem. In other words, Islam deemed
the moral code an adequate solution for this problem.

The attempt in this belated century to ‘solve’ this problem in
a way which conflicts with the Ijma’ of the Ummah, and in a way which
le- galizes riba is the arrogation to oneself of the right to ‘re-interpret’ the
Immutable Shariah. This is a curse which has settled on modern- ist, westernised
Muslims. Its tentacles are being spread towards even the Ulama who are becoming
ensnared in its grip. In view of the fact that the Shariah has not imposed
any monetary penalty for even de- liberate procrastination, it is highly improper
to transgress the limit of Allah Ta’ala by attempting to supersede the
Shariah in the matter of providing a solution for a problem which had already
existed dur- ing the time of Rasulullah (sallallahu alayhi wasallam) but for
which neither he nor the entire Ummah had considered proper to transgress beyond
the confines of the moral code of Islam in a pursuit for a so- lution.