Shariat Appellate Bench Regarding Interest Based Banking System
It was a momentous event, as big as the creation of the country itself. On 14 Ramadan 1420, the Shariah Appellate Bench of the Supreme Court of Pakistan gave its landmark decision banning interest in all its forms and by whatever name it may be called. Thus fifty-five years after its creation in the name of Islam (27 Ramadan 1365), Pakistan became the first Muslim country to officially declare modern (and rampant) bank interest as Ar-riba, declared haram by Qur'an. The court also specified a step by step approach to rid the country of the evil of interest. As a consequence of this judgment, certain laws will cease to take effect from 31 March 2000, some other laws from 31 July 2000, and all other laws permitting or condoning interest from 30 June 2001. The Federal Shariah Court of Pakistan had declared the laws allowing interest repugnant to Islam in 1991. The Federal Government of Pakistan and certain banks and financial institutions filed 67 appeals against this judgment in t...