INTRODUCTION
An agreement turns into a contract when it becomes enforceable at law. A contract is usually an exchange of promises between two or maybe more persons. In Islamic law, contract rules are stringent; fairness and equality have to be upheld, and its condition is performance.
DEFINITION OF CONTRACT
The corresponding Arabic term for the contract is Aqd, which means “conjunction or tie”. Legally, “Aqd” indicates a conjunction of disposition elements: proposal and acceptance.
According to Webster’s Dictionary
“A contract is a binding agreement between two parties which is legally enforceable.”
CONCEPT OF CONTRACT IN ISLAM
In Islamic law, the contract is an agreement that requires that there should be two parties. One party should propose, and the other party should accept it. The mind of both parties must agree that their declaration must relate to the same matter, and the object of the contract must be to produce a legal result.
Examples: A offers B to sell his Bicycle for Rs.5000/- B accepts A’s request. Thus, a legally binding contract has been formed under Islamic law.
ESSENTIAL INGREDIENTS OF CONTRACT
The following are essential requirements or main constituents of a valid contract under Islamic law.
1. OFFER (IJAB)
An offer is a proposal made by one person or party offering the sale of an object or offering the other party to form a legally binding contract. This offer is called Ijab in Islamic law.
Modes of Offer:
Offer is of the following kinds.
- Express offer
- Implied offer
- Specific offer
- General offer
Termination of Offer
In the following cases, a proposal is terminated under Islamic laws.
- Termination by revocation
- Termination by lapse of time
- Termination by failure to fulfil conditions
2. ACCEPTANCE (QABUL)
Acceptance is the willingness of the person to whom an offer is made to enter into a legally binding contract.
Conditions for a Valid Acceptance
For valid acceptance, the following conditions must be fulfilled.
- It must conform with the terms of the offer.
- It must be given at the same time when an offer is made.
- It must be communicated within a reasonable time.
Communication of Acceptance
The necessary ingredient for a valid contract is the communication of its acceptance. Without approval, an agreement is incomplete; if this acceptance is not communicated, it cannot be considered a contract component. This communication should be made within a reasonable period and can be made in any mode.
3. CONSIDERATION
In Islamic laws, the equivalent word for consideration is Sabab. The consideration is the act, forbearance, promise, or payment given by one party in turn of the action or promise of another. Islamic law specifies the following four essentials to constitute a valid contract.
- Faa’lia: A valid contract requires that there must be two parties involved.
- Mad’dia: One party should make an offer or proposal, and the other should accept it.
- Suria: The parties must agree to the same matter in the same sense.
- Ghayla: The object should produce a legal result.
4. COMPETENCE OF PARTIES
Under Islamic law, the contract would be void if a person entering into a contract does not possess the necessary competence. Therefore, the parties must be competent to contract to form a legally valid contract. Under Muslim law, the following are the persons qualified to rent.
- A person who has attained the age of maturity.
- A person who is not insolvent.
- A person who is not disqualified by law.
- A person of sound mind.
5. FREE CONSENT OF THE PARTIES
Competent parties must have free consent regarding a contract. They must agree on the same thing and in the same sense and should not give their support in the following situation.
- Coercion
- Undue influence
- Fraud
- Misrepresentation
- Mistake
6. LAWFUL SUBJECT MATTER
In Islam, the contract should be regarding permissible things. A contract regarding the trade of wine is not a valid contract.
7. CERTAINTY
If there is any uncertainty or dignity regarding the contract’s subject matter or its quantity and quality, then it is not a valid contract in Islam.
8. LEGAL FORMALITIES
The contract must be in writing, signed and attested by witnesses, and registered if required by the law in force. Section 17 of the Registration Act of 1908 requires specific documents to be written. Thus, a valid contract has to abide by such formalities provided by law.
CONCLUSION
In Islamic law, a contract establishes a tie of legal relations arising from the consent of minds of two persons to deal with each other in respect of certain rights of theirs.
Frequently Asked Questions
What are the ingredients of a Contract of Sale under Islamic Law?
(2019-A five years, 2016-A)
What are the essentials for forming a contract of sale under Islamic provisions?
(2015-S)
Can a minor be a party to a contract of sale and purchase? What are the ingredients of a valid contract according to Islamic Law?
(2014-S)
What are the essentials of a contract of sale under Islamic Law? Is there any fundamental difference between the Law of Contract 1872 and the Islamic Law of Contract?
(2014-A)
A contract of sale is valid without offer and acceptance in Islamic Law. Do you agree? What are the ingredients of a Contract?
(2013-S)
REFERENCES
- Islamic Jurisprudence by Imran Ahsan Khan Nyazee
- N-Series by M.A. Chaudhary
