Ijarah Muntahia Bittamleek. 1 definition. Ijarah Muntahia Bittamleek. as defined in Bahrain Monetary Agency Rulebook, Islamic Banks: Glossary of Defined. Lease (‘ijarah) contracts that end up with transfer of ownership of leased assets to the lessee. It can take one of the following forms: (i) A contract tha. Shari’ah Standard No. (9): Ijarah and Ijarah Muntahia Bittamleek Statement of the Standard 1. Scope of the Standard This standard covers operating leases.

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An Ijarah may be renewed for another term, and such ljarah may be made before the expiry of the original term or automatically by adding a provision in the new contract for such renewal when the new term starts, unless either party serves a notice on the other of its desire not to renew the contract. Ijarah and Ijarah Muntahia Bittamleek this sum except bittajleek proportion to the actual damage suffered by the Institution in case the customer does not fulfil his promise.

For ijjarah, a house or a chattel may not be leased for the purpose of an impermissible act by the lessee, such as leasing premises to be used as headquarters by an Institution dealing in interest or to a shopkeeper for selling or storing prohibited goods, or leasing a vehicle to transport prohibited merchandise. Any stipulated upfront rental or accelerated -because of delay mubtahia payment- rental is subject to settlement at the end of the Ijarah period or, if the Ijarah contract is terminated earlier, at the time of such termination.

Monetary and Banking Developments – September Protection of Capital and Investments – Adoption of the Standard. This benchmark should be subject to a ceiling, on both maximum and minimum levels.

Ijarah and Ijarah Muntahia Bittamleek covering the duration of the Ijarah contract, or by instalments for parts of the duration. However, if the asset is made available only after a period longer than what customary practices deem proper, then no payment shall be obligatory.

For bittam,eek, it is not permissible, if the first rental is one hundred dinars payable on a spot basis, for the lessee to sublet it to the lessor for one hundred and ten dinars payable on a deferred basis, or if the first rental is one hundred and ten dinars payable on a deferred basis, for the second to be for one hundred dinars payable bittammleek, or if the two rentals are of the same amount, but the payment of the first bittamleej is deferred for one month and the second rental is deferred for two months.

Ijarah and Ijarah Muntahia Bittamleek – Scope of Standard –

Both he and the lessor may also agree to amend the mumtahia in case of partial destruction of the leased property, if the lessee waives his right to termination. In this case, they become co-owners in the usufruct of the leased property. In this case, an agreement is reached to make the described asset available during the duration of the contract, giving the lessor the opportunity to acquire or to produce it.

In all these cases, the separate bittamleeo evidencing a promise of gift, promise of sale or a promise of gift contingent on a particular event, should be independent of the contract of Ijarah Muntahia Bittamleek and cannot be taken as an integral part of the contract of Ijarah. However, it is preferable for the Institution to forgo any amount in excess of the actual damage it has suffered.


Ijarah and Ijarah Muntahia Bittamleek an asset that does not conform to the description, then he is entitled to reject it and demand an asset that conforms to the description. By using this site, you agree to this use. However, he may not, after the contract is signed, charge the lessee any cost in excess of the cost anticipated at the time of fixing the rent.

The lessor may take out permissible insurance on it whenever possible, and such insurance expenses must be borne by the lessor. The lessor in this case is not entitled to rent for the period during which the lessee was not able to benefit from the asset unless the lessor makes it up by agreement with the lessee with a like benefit after the expiry of the period specified in the ijarxh.

Central Bank of the United Arab Emirates: The Ijarah shall continue for the remaining time of the contract. This website uses cookies to improve services, analyse traffic to our site, deliver content and provide tailored ads.

In this case, the Ijarah transaction should not be stipulated as a condition of the purchase contract by which the Institution acquires the asset.

This can only be done before entering into a sub-lease. In this case, the rental specified as receivable by the Institution should only be in proportion to its share in the ownership of the asset, since the lessee is a co-owner of the asset and therefore has to pay rent only on the share that he does not own.

Ijarah Muntahia Bitamlik

Ijarah and Ijarah Muntahia Bittamleek have not yet been paid become a debt owed to the lessor by the lessee, and therefore cannot be increased.

If the property is sub-leased after the co-owners having owned the usufruct each co-owner is entitled to a share in the sub-lease rental pro rata to his share in the usufruct. Termination is also possible when one party secures an option to terminate the contract in which case the party who holds the option may exercise it during the specified period.

In this case, there may either be a separate lease contract for each transaction, in a specific written document signed by the two parties, or alternatively the two parties may exchange notices of offer and acceptance by referring to the terms and conditions contained in the master agreement. In such a case, it may not be stipulated that the rest of the instalments should be paid.

However, it is for a customer to request an Institution to acquire the asset or to acquire the usufruct of an existing asset which the customer wishes to take on lease. This period must be long enough so that the leased property or its value could have changed. Ijarah and Ijarah Muntahia Bittamleek damage to the leased asset by misuse through misconduct or negligence.

It is also permissible to make the rent payable in instalments, in ijaraah case ijaraj lessor may stipulate that the lessee should immediately pay the remaining instalments if he, after receiving a specified period ijsrah due notice, delays, without a valid reason, payment of one instalment or more, provided that the asset shall be made available for the lessee to use for the remaining period of time. It is not a requirement of this lease that the rental should be paid in advance as long as the lease is not executed according to the contract of Salam or Salaf.


In this case the lessee may benefit from the leased share in the same way in which the lessor used to benefit from it, i. Weekly Money and Banking Statistics. The lessor may take this into account implicitly when the lease rental is to be fixed.

Ijarah and Ijarah Muntahia Bittamleek of rental for previous periods, and not all rental instalments, including instalments which have not yet fallen due and in respect of periods for which the lessee has not had the benefit of the leased ijarh. It is then permissible that the rentals for subsequent periods be determined according to a certain benchmark.

See our Cookie Policy. None of these rules should be breached under the pretext that the leased asset was bought by the lessor on the basis of a promise by the lessee that he would acquire it or that ownership of it would devolve upon him, or that he would pay rentals in excess of those payable in respect of a similar property which are similar in amount to the instalments of an instalment sale, or that local laws and conventional banking practices consider such a transaction as an instalment sale with a deferred transfer of the ownership.

However, it is permissible to have a master agreement drawn up coveringa number of Ijarah transactions between the Institution and the customer, setting out the general terms and conditions of agreement between the two parties. If the purchaser does not know about the Ijarah contract, he may terminate the sale contract, but if he knows about it and consents to it, he takes the place of the previous owner in his entitlement to the rental for the remaining period.

Sign in to continue reading The rental may be paid entirely in advance or in instalments during a period equivalent, or more or less, to the duration of the Ijarah.

However, the heirs of the lessee may terminate the Ijarah contract if they can prove that the contract has become, as a result of the death of their legator, too onerous for their bitamleek and in excess of their needs.

Ijarah and Ijarah Muntahia Bittamleek also apply to the case of early ownership of the asset where a sale contract is concluded during the Ijarah. Malaysia Economic Census – Environmental Compliance. If it is not possible to provide muntahiw substitute asset, the contract will be terminated. It may also be for a fixed or variable amount, according to whatever designated method the two parties agree upon. However, a binding promise is binding on one party bittampeek, while the other party must have the option not to proceed.

Ijarah and Ijarah Muntahia Bittajleek b A promise to give it as a gift for no consideration. That is, the difference between the prevailing rate of rental and the rental specified in the contract must be refunded to the lessee if the latter rental is higher than the former.