Abstract
In Islamic law of Business rules, there is a terminology of “Muqassah”, which in Arabic etymology means, Debt settlement by a contra transaction when someone is indebted to a person and this person in the same time is indebted to the first one of the similar amounts of money. In terminology point of view, Muqassah means the discharge of a debt receivable against a debt payable or. Thus, muqassah is one of the ways to pay someone’s debt. New forms of Muqassah have been introduced in the modern Islamic banking system. It has turned into a complexed system after the emergence of modern technology. Therefore, there is a great need to discuss the modern application of the rules of set-off already set forth by Shariah to modern financial transaction. These modern applications include set-off between customer and financial institution and also between tow financial institutions through cheque and sometimes through clearing house. This sett-off may take place through national and international networking system. This article proceeds with an introduction of the term “Muqassah” and other related terms. It further discusses the classification, conditions and shariah ruling of each type of “Muqassah” (Set off). The article ends with conclusion of this discussion about set-off.
Hafiz Moazzam Shah, Hidayat Khan. (2021) Forms Of Contracts And Their Rules In Contemporary Islamic Banking, Habibia Islamicus, Volume-05, Issue-2.
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