Volume 4 Issue 2 2008


Farooq Aziz
Department of Business Administration, Federal Urdu University

Noor Muhammad Jamali
Institute of Commerce, University of Sindh

Abstract Mudaraba'a is a special type of partnership in Islamic Shari'a, between at least two partners for any trading purpose. Out of them one is financer, and the other in worker. The role of financer is as a sleeping partner, and worker run's the business by using his labour and expertise. By keeping the same division number of partners may be increased. Profit is divided among the partners in a pre-decided ratio, but the entire loss should be faced by financer only. This type of Partnership is common in business and have significant importance in so-called Islamic banking or interest free banking. Whereas the question of its legality is concerned, there is a consensus about it, and different arguments are given from Qur'an and Hadith for its validity. But unfortunately non-of them have any logical or intellectual base. Any solid proof from Qur'an & Hadith is not available in this regard. The events which are presented in this context from the life of holy prophet Muhammad & Sahaba-e-karam do not have any concern with fikhi term mudaraba'a. The same situation is with other reasons which are given in this regard. On the other hand this act has a deep resemblance with riba (interest). Since no evidence can be provided to prove its validity, hence mudaraba'a is completely unlawful from Islamic point of view.
Keywords Mudaraba'a, Qur'an, Hadith, Verse
Year 2008
Volume 4
Issue 2
Type Research paper, manuscript, article
Recognized by Higher Education Commission of Pakistan, HEC
Category "Y"
Journal Name IBT Journal of Business Studies
Publisher Name ILMA University
Jel Classification -
ISSN no (E, Electronic) 2409-6520
ISSN no (P, Print) 2416-8393
Country Pakistan
City Karachi
Institution Type University
Journal Type Open Access
Manuscript Processing Blind Peer Reviewed
Format PDF
Paper Link