Forbidden Business Transactions And Their Implication: Shariah Perspective

Abstract

The Muslim faithfuls have been trying feverishly since decolonization in the 20th century to establish themselves and their desire in adhering to the true essence of Islamic business transaction based on the Quran and Sunnah. Their dreams have been derailed due to the application of the stated principle (sub maxim) “all is halal until proof shows it to be haram” as an alternative to the Quran and Sunnah to evaluate the Islamic business transactions within the financial and banking institutions. This stated principle (sub maxim) is casting a dark cloud of doubts upon the Muslim faithfuls when it comes to Islamic business transactions. The stated principle (sub maxim) was analyzed by using the primary and secondary sources to verify whether or not the stated principle is stated within the Quran or Sunnah. I found that the stated principle (sub maxim) was not mentioned or stated in the Quran or Sunnah. The stated principle (sub maxim) is rather an analogical interpretation of a major maxim which was taken from the concise expression of the prophet’s wording. This research proved that the stated principle (sub maxim) “all is halal until proof shows it to be haram” cannot be used as an alternative to evaluate Islamic business transaction. This research also shows that by utilizing alternatives to the Quran and Sunnah, it only gives rise to doubts and has no financial or Islamic benefits to the Muslim faithfuls. Furthermore, this research exposes the truth about the other Islamic tools (principles, theories and systems) that are being used as an alternative to evaluate Islamic business transactions within the Islamic financial and banking institutions. Also, this research was done with the sole intention to bring some form of tranquility between the Muslim faithfuls, the Islamic financial and banking institutions as well as the conventional institutions that promote Islamic products.