The averment, “If nothing is charged from the defaulters, it may be a greater incentive for
a dishonest person to default continuously”, is tantamount to implying
that Allah and His Rasool (sallallahu alayhi wasallam) did not foresee such a
development, hence the divine Shariah contented itself with its moral code to
solve the problem — Nauthubillaah! The averment implies that the Shariah
by not charg- ing anything for the act of default in payments, has provided “dishonest
defaulters with greater incentive to default continuously.” Islamically
these conclusions are absurd and of an exceptionally grave nature.

The charge which Hadhrat Mufti Saheb’s question gives rise to is di- rected
at the Shariah of Islam which by implication has provided “greater incentive” to
dishonest defaulters to default because it does not impose any charge on such
defaulters.

The attempt to supersede the Shariah by augmenting its tenets with mutative
rules is fraught with the gravest perils. The mind of the Mu’min should
operate parallel with the methodology and spirit of the Shariah. It should
not formulate arguments which lead to the con- clusion that there is some deficiency
in the Shariah of Allah Ta’ala. This is precisely the conclusion which
stems from the aforegoing averment of Hadhrat Mufti Taqi Saheb. Since Islam
has not ordered any monetary fine or riba for even deliberate defaulters, Muslim
creditors should tolerate the incidence of delayed payments and con- sider
their patience to be an act of Sadqah which will not go unre- warded, neither
in the Hereafter nor in this world. The proclaimed ‘loss’ which
banks are said to suffer in consequence of late pay- ments, is a figment of
imagination. It exists in only theory, not in practice. Furthermore, banks
are not entitled to any monetary com- pensation for such imagined ‘loss’,
nor do they have the right to im- pose monetary penalties (riba) on defaulters
irrespective of any imagined designs of altruism which the bankers are urged
to have in mind for such haraam monies which they exploit from defaulters.
Since the act of levying a monetary charge for late payments runs contrary
to the teachings and spirit of the Shariah, Hadhrat Mufti Sa- heb’s entire
argument to justify the riba penalty, to put it mildly, is redundant, uncalled
for and superfluous. In other words, it is baatil. Nevertheless, we shall present
the venerable Mufti Saheb’s argument to further highlight the discrepancies
and the conflict with the Shariah.

HADHRAT MUFTI SAHEB’S ANSWER

Answering his question, Hadhrat Mufti Saheb says: “Here is the answer
to this question. We have already mentioned that the real solution to this
problem is to develop a system where the defaulters are duly punished by depriving
them from enjoying a fi- nancial facility in future.”

In his aforementioned answer, Hadhrat Mufti Saheb proposes that the “real
solution” is “to develop a system” for the “punishment
of the defaulters”. His proposal implies that the Shariah has not offered
such a system, hence the need to “develop” such a system. The en-
deavour to supersede the Shariah should thus be manifest. Inspite of the problem
having existed since time immemorial, the Shariah did not devise a system of
punishment for the defaulters other than its sacred code of morality which
warns them of dire consequences in both this world and the Aakhirah for deliberate
procrastination in ef- fecting payment.

The system to punish defaulters by depriving them of future credit facilities
already exists. Hadhrat Mufti Saheb has simply suggested that the blacklisting
system of the capitalists be incorporated into the Shariah.

Since the Shariah has deemed it adequate to restrict the solution to its Moral
Code, no Muslim has the right to arrogate to himself the task of developing
a system of monetary imposition to punish those who find themselves unable
to pay on due date. The claim of ‘deliberate defaulting’ is a flimsy
pretext cited for justifying the endeavour to create a system of monetary punishment
which is no better from and not different to the capitalist system of charging
interest on late pay- ments.

We have earlier (on page 11) explained the practical impossibility of ascertaining
with certitude who the honest and the dishonest de- faulters are. In fact,
Hadhrat Mufti Saheb has forgotten this reality which he himself has stated
with clarity in his refutation of the view of “some contemporary scholars”.
Stating this reality, Hadhrat Mufti Taqi Saheb says in his book: “But
in practical application of the concept, these conditions are hardly fulfilled,
because every debtor may claim that his default is due to his financial inability
at the due date, and it is very difficult for a financial institution to hold
an inquiry about the financial posi- tion of each client and to verify whether
or not he was able to pay. What the banks normally do is that they presume
that every client was able to pay unless he has been declared as bankrupt or
insol- vent…….Therefore, the suggestion leaves no practical and
meaning- ful difference between an interest based financing and an Islamic
fi- nancing.”

When the position concerning the detection of dishonest defaulters is one
of practical impossibility—a position which Hadhrat Mufti Sa- heb utilizes
in refutation of the interest charge suggested by “some contemporary
scholars”—what makes it practically possible in the proposal put
forward by Hadhrat Mufti Taqi Saheb? How will his system of punishment be practically
effected against dishonest de- faulters when such defaulters cannot be detected
with any certitude? In effect, the end result of his system of punishment is
the same as the result of the view of “some contemporary scholars” whose
opin- ion the venerable Mufti Saheb has dismissed as baseless. This end result
is stated by Hadhrat Mufti Saheb as follows:

“What the banks normally do is that they presume that every client is
able to pay…….”

This is the usual presumption of all banks and traders. In other words, all
defaulters are ‘dishonest’ in the bank’s estimation, hence
the applicability of the riba penalty to all those who are unable to pay on
due date. Hadhrat Mufti Saheb has made the element of ‘dishonesty’ pivotal
in his opinion to legalize the riba penalty al- though he concedes the practical
impossibility of ascertaining the dishonesty of the defaulters. Just as he
has cited this practical impos- sibility in negation of the view of “some
contemporary scholars”, so too do we present this factor in refutation
of his opinion which has no Shar’i basis.

When on his own admission “every debtor may claim inability to pay” and
not accept the charge of dishonesty, how does he propose to apply his system
of punishment?

It is clear that any system to punish the defaulters is not workable in view
of the inability of the system to establish the dishonesty of de- faulters
with certitude. Thus, while in theory the system will exist, in practice the
financers will apply the ‘punishment’ of riba to all de- faulters
regardless of the element of ‘dishonesty’ for whose eradica- tion
the system was ostensibly initiated. Assuming that a method for easy detection
is devised whereby it could be established if a defaulter is honest or dishonest,
then too, the ‘punishment’ proposed by Hadhrat Mufti Saheb is unacceptable
be- cause it is haraam riba. It is as simple as that!