FSC verdict on interest-free economy challenged in Supreme Court

ISLAMABAD: The Federal Shariat Court’s verdict on the interest-free financial system has been challenged in the Supreme Court, ARY News reported on Saturday.

The Federal Shariat Court had declared an interest-based financial system in the country against sharia in a landmark verdict in April.

Salman Akram Raja has filed appeal against the FSC verdict on behalf of the State Bank of Pakistan. Four commercial banks have also filed appeal against the Shariat court decision in which the ministries of finance, law, the Chairman Banking Council and others have been made respondents.

READ: CII WELCOMES FSC VERDICT AGAINST INTEREST-BASED ECONOMY

“The FSC in its decision didn’t keep in view the rules under the Supreme Court remand order,” according to the appeal. “The Federal Shariat Court declared the rules about saving certificates against Islam and also ordered amendment in these rules.”

The petitioners sought approval of the appeal against the FSC decision. They pleaded for amending the court’s decision to the extent of the points raised in the decision.

A three-member bench of the Federal Shariat Court in its verdict said that the existing laws related to riba and interest are against Shariah and it is the responsibility of the government to replace the existing system and bring laws in accordance to the guidance in Quran and Sunnah.

READ: RIBA CASE VERDICT: FSC DECLARES INTEREST AGAINST SHARIAH

The court declared that banks and other financial institutions receiving interest is against the Shariah. “Receiving additional amount on loans and change in agreement also comes under riba,” it ruled and directed the government to follow Shariah laws while finalizing agreements with Chinese government for CPEC projects.

The court further set a deadline of 31 December 2027 to fully implement court’s order on elimination of interest from the country and said that the government could also implement the decision prior to the deadline.

The Full Bench of the Federal Shariat Court comprising of Justice Muhammad Noor Meskanzai Chief Justice, Justice Dr. Syed Muhammad Anwar and Mr. Justice Khadim Hussain M. Shaikh had reserved the verdict in Riba case on April 12.