The case was referred to the FSC by the Supreme Court to reconsider its ruling.
ISLAMABAD: The central bank on Thursday informed the Federal Shariat Court (FSC) that the Constitution does not explicitly define interest commonly known as ‘Riba’.
Hearing the case on Riba (usury), that had been shelved for over two decades, the FSC issued notices to ten amicus curiae namely Dr Tahir Mansoor, Hafiz Muhammad Tufail, Yousaf Farriqi, Saleem Elahi, Babar Awan, Justice retired Afzal Haider, Allama Abbas Kumaily, Dr Ateeq Zafar, Mufty Zahid and Muhammad Ayub.
During the hearing on Thursday, Salman Akram Raja, counsel for State Bank of Pakistan contended before the Shariat Court that the Constitution specifically mentions the elimination of interest, but does not define ‘interest or Riba’. He explained that the economy thrives on instruments including taxes and loans and that the country, in its economic interest, should stay in touch with the global financial system.
Subsequently, in its order the FSC invited suggestions regarding Riba, which was declared repugnant to the injunctions of Islam in 1992. The court is set to resume hearing after winter vacations.
In 2002, the case was referred to the FSC by the Supreme Court to reconsider its ruling, which declared interest or Riba unacceptable.
Earlier, in 1999, hearing an appeal against the decision, the Supreme Court’s Shariat Appellate Bench upheld the FSC decision and gave the then government two years to amend all banking laws and other statutes to prohibit Riba.
Later, however, the government and some banks had instituted a review petition before the Supreme Court.
The apex court also directed the FSC to take input from contemporary jurists of the Muslim world.
The FSC had already commenced the preliminary proceedings of the hearing last year in 2013.
Published in The Express Tribune, October 30th, 2015.