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Legal System Malaysia

Info: 5474 words (22 pages) Essay
Published: 22nd Jul 2019

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Jurisdiction / Tag(s): UK LawIslamic Law


The legal system of Malaysia is based upon the English common law. However, before the arrival of the British in 1826, classical Islamic law was one of the main legal sources of the country. Islam had arrived in Malaysia by around 1303. Since then the teachings of Islam have been translated into the local people, and classical Islamic law has come to be in force in the region. At this point, classical Islamic law has been accepted through the process of the validation of some established local rules and the imposition of the Shafi’is classical precepts (fiqh) (Hooker 1988, pp. 8-9). Accordingly, classical Islamic law developed and the climax of which was the codification of the law in the Malacca Empire (Hooker 1970, pp. 71-90; Ibrahim 1987, pp. 47-52).

Nevertheless, with the introduction of the English common law, this development was stunted and some of the principles have been abandoned. It is observed that while introducing the English common law, judges have always endeavored to restrict the application of the classical Islamic law. In Baker Ali Khan v Anjuman Ara Begum (1903) 30 I.A. 94 at 111-112, for example, there was a great concern among the judges with regard to the application of the classical Islamic law in the region. Hence, the influence of the classical Islamic was reduced and a vast portion of the precepts have been abandoned.

Islamic Jurisprudence

Literally, fiqh means understanding; it refers to the study of the law in Islam and is usually defined in jurisprudence and the knowledge of the rights and duties whereby human beings plows enabled to observe right conduct in this life and to prepare them for the world to live. Whereas shariʿa refers to the divine law itself, fiqh denote the human interpretation of the divine commands; it constitutes the disciplines of deriving and formulating positive law in a to number of branches (furu), including worship (ibadat), contractual law (muʿamalat), criminal law (to taʿzir and hudud), and family and personal law (ahwal shakhsiyya).

Although there is agreement among the schools of law on the main principles of usul al-fiqh, differences exist on the legitimacy of some legal methods or sources, for ace instance istislah, or maslaha mursala, in which law dog sees derived without reference to textual sources. Eventually, to however, restrictions were introduced to reduce the possibility of arbitrariness and to legitimize these legal procedures. Usul al fiqh or the roots of islamic law, expound the indications and methods by which the rules of fiqh are deduced from their sources.

These indications are found mainly in the Quran and Sunnah, which are the principles sources of the islamic law. The Quran and Sunnah themselves however contain very little by way of methodology but rather provide the indications from which the rules of Shariah can be deduced.

Textual The reform movements of the eighteenth century emphasized sources and turned away from consensus, which was considered to sees the causes to possible for the lack of development in the law. For The call by some contemporary jurists the uses of unrestricted ijtihad to resolve modern issues there are caused tension and stalled attempts at reforming Islamic law. Secular with the adoption of constitutions, most Muslim countries have stopped using fiqh except in to matter of family law.

Definition Of The Term ‘Law

In Islamic legal science, the philosophy or concept of ‘law’ is unanimous among all the jurists and the schools of law right from early periods till today. No dichotomy or conflict of opinion upon this issue does exist in Islam. Therefore, in Islamic Jurisprudence, the term ‘law’ possesses a permanent and universal character, which is not subject to any alteration. ‘Law’ in Islamic terminology signifies the word ‘Hukm’ or ‘Hukm al-Sharii), which is defined as: “Law is a Rule of human conduct established by a communication from God, expressive either of demand or indifference or a mere declaration. In other words, ‘law’ is a body of rules with reference to human conduct, established from: Qur’an, (because it is an explicit and manifest version of Allah’s communications): ‘Prophetic Sunnah’ (because it is an implicit version, practical denotion and physical demonstration of Allah’s communications) and ‘Definite Ijma’, (because it is an authoritative device of knowing and inferring what God has divinely communicated to mankind). The issue of philosophy of law in Islam could not be grasped fully without making reference to the elements of law from the Shariah perspective. The elements of law are:

Elements Of Law

Hakim- Law-Giver That Means Sharie.

God Almighty and His Prophet possess an exclusive lawgiving authority in Islam. God is known to be the Hakim in real and ultimate sense whereas Prophet Muhammad exercised His Lawgiving authority, being the direct recipient of His divine powers and final agency of His Legislative sovereignty. Therefore, whatever is ordained or abstained by the Holy Prophet, is exactly known as the command of God Himself. The Qur’an has narrated this in fact in the words: “And whatever the Apostle gives you, take it; and whatsoever he forbids you, abstain from that”. Furthermore, the Qur’an reiterates in Surah al-Maidah (5:2) saying: “He who obeys the Apostle, obeys God indeed”.

Hukm- That Means Legal Rule Or Value Established Through Communication Itself

According to most of the Muslim Jurists, there are 500 Quranic verses which expressly prescribe legal values. These are known as Ayat-ul-Ahkam. There are also approximately 3000 Prophetic traditions which directly and expressly deal with modes of human conduct. They are known as Ahadeeth-ul- Ahkam.

In addition to the 500 Quranic verses mentioned above, there are another 200 verses which deal with acts of omission and commission. It means that the total number of Quranic verses which expressly or impliedly possess legal material comes up to 2500. The same applies to Prophetic traditions. The light of standard definition of law or Hukm, Islamic Jurisprudence divides it into two classes: (i) Primary or defining law (law which requires demand of commission or omission of an act from a person legally capable or which provides him the discretion between the commission or omission of a particular act) and (ii) Declarative or declaratory law.

Objective Of The Law (Mah Kum Bihi Or Mah Kum Feeh)

By objective of the law, we mean the purpose for which divine law is revealed. They embody the motives and intentions that necessitated the express manifestation of divine legal guidance. The purpose for which the divine law is revealed are three: (i) acts i.e. acts impossible in nature and practice, acts possible in nature but impossible in practice and acts possible in nature and practice. The law in Islam exempts human beings from the binding application and influence of the first two categories of acts because they are outside the scope and exercise of man’s authority. God Almighty has stated: “On no soul does God place a burden greater than it can bear”. See also in Surah al-Baqarah (2:173) which states: “Our Lord, do not lay on us a burden greater than we have strength to bear”. (ii) rights and (iii) obligations.

Mah Kum Alayh-That Means Subjects Of The Law

Subjects of law are the people for whom the law of Shariah is revealed. By the term people we mean legally capable persons who are technically termed as Mukallaf and the fitness of a person for the application of law to his actions is called legal capacity.

Purpose Of Law

It is to make good persons and a good society. Its whole objective is ethical and moral. Shariah establishes what is good and beautiful. If something is not moral (good and beautiful), it is not part of Shariah. In other words, Shariah is the law that is based on ethics. Its basic values are permanent and universal. Shariah deals with the outward and inward. The rules of Shariah cannot be fulfilled without sincerity, true intention, love, and respect of the law and the Law-Giver, Allah. See Surah Ali Imran, Allah says: “You are the best of peoples, evolved for mankind, enjoining what is right, forbidding what is wrong and believing in God.” (Surah 3: 110)

Source Of Law Is Based On Divine Revelation

Source of law is based on Divine revelation- All the injunctions of Islamic Law are revelation from Allah, so the one who is legislating for mankind is their Creator who knows best what will be of benefit to his creation in both this world and the next. He knows the psychological makeup of the human being, what will be in harmony with it, and what will clash with it.

Allah says: “Does the One who created not know, and he is the Gentle, the All-Aware”. See also Surah 7: 3, which states: “Follow the revelation sent unto you from your Lord, and do not follow the (so-called) guardians other than Him”. See also Surah 5:44 “And those who do not make their decisions in accordance with that revealed by Allah, are (in fact) the disbelievers”.

Islamic Judicially In Malaysia

Judicial Power

Though Malaysia is a federation, the Federal Constitution had up to 1988 only a single hierarchy of Courts having Jurisdiction over both Federal and State laws and matters; but State Constitutions and the Islamic Administration Enactments had provided for syariah or khadis’ Courts to deal with Islamic religious and Islamic Personal Law and Malay Adats matters dealt with in the State laws with no involvement of federally established civil Courts at any stage. By Article 121(1), ‘the judicial power of the Federation (was) vested in the two High Courts’ subject of course to (Federal) Supreme Court’s powers and jurisdiction. The 1988 Constitution Amendment rectified the anomaly, in so far as the State Syariah Courts were left out of the ‘Judicial Power’ envisaged by Article 121, by adding to it clause (1A) to the effect that ‘The Courts referred to in clause (1) shall have such jurisdiction in respect of any matter within the jurisdiction of the Syariah Courts’; but at the same time it excruciated or emasculated ‘Judicial Power of the Federation’ from its constitutional base making it totally depended for its powers and jurisdiction and powers as may be conferred by or under Federal Law,’ and effectively nullified or muted Supreme Court decision in Dato Yap Peng v. Public Prosecutor,29 which had held Public Prosecutor’s/Attorney General’s power under s. 418A of the Code of Criminal Procedure to certify a case before a Subordinate Court to be tried by the High Court as uncanalised and impinged upon the judicial powers of the Courts. Thus came to be established two set of Courts, civil and syariah, separate and independent of each other except that in constitutional matters it is the civil Courts (Supreme Court and High Courts), and not the Syariah Courts, that have jurisdiction. Some States have two tier and others have three tier of Syariah Courts (Syariah Courts, Syariah High Court and Syariah Court of Appeal : See Selangor Enactment 2 of 1989).

In terms of clause (1A) of Article 121, matters that are within Syariah Courts’ jurisdiction fall outside High Courts’ (civil courts) jurisdiction and in terms of item (1) of the State List Syariah Courts will have jurisdiction :

  1. over persons professing the religion of Islam; and
  2. in respect only of the matters included in this paragraph (i.e. item 1) but it will not include offences except in so far as conferred by Federal Law. (Note: Such a jurisdiction has now been conferred by an omnibus s. 2 of the Syariah Courts (Criminal Jurisdiction) Act 1965).

The Syariah Court’s jurisdiction is restricted to matters included in para/item (1) of the State List. Although the State law may create and punish offences by Muslims against the precepts of Islam except in regard to matters included in the Federal List, the Syariah Courts will not have jurisdiction in respect of these offences unless it is conferred by Federal Law. Further, this juxta-position of the provisions clearly indicate that when the Federal Laws create and punish offences by Muslims against the precepts of Islam in regard to matters included in the Federal List, they also fall outside the jurisdiction of the Syariah Courts established by the State Law under item (1) of the State List. Such matters may be provided or dealt with either separately or as part of general law, particularly when Islamic values or norms are given effect to for general applicability, (not necessarily restricted to the Muslims) to all persons. There may also be matters Islamic which States have legislated upon, but did not expressly confer jurisdiction over them on the Syariah Courts. Which Courts shall have jurisdiction in such matters? Can there be established Federal Syariah Courts for the purpose?

Parliament is denied, by item 4(a) of the Federal List the power to constitute and organise ‘Syariah Courts’. A very anomalous situation indeed; otherwise, the establishment of Federal Shariah Courts for these matters would have been a viable solvent. The alternative is civil or non-Syariah Courts which already have, by virtue of cl. (1A) of Article 121, the residuary jurisdiction of what lies outside the Syariah Court’s jurisdiction. These civil or non-Syariah Courts (High Courts, Court of Appeal and Supreme Court) can be the suitable alternative if, and only if, they have on them Muslim judges well versed in Islamic law and Islamic religion as well, and a separate or special bench in each of these Courts may be constituted to deal with such matters under and in respect of matters Islamic under Federal laws, and also if Parliament so chooses under State Laws. If need be there can be a provision for co-opting Syariah High Court or Syariah Court of Appeal Judges to serve on these benches. The jurisprudence that may be developed by such mixed civil Courts would go a long way in creating and developing Malaysian Common Law fully based upon or integrating Islamic values, principles and precepts (of course within the limits provided by the Constitution) into the body structure of the general laws and legal system.

That the establishment of such a judicial set up is imperative is demonstrated by the typical cases that have been, of recent, coming before the civil Courts. In Mohd. Habibullah bin Mahmood v. Faridah bt. Dato Talib,31 the Supreme Court was divided 2:1 on the question whether the Syariah Courts or the High Court in Kuala Lumpur had the jurisdiction to give to the respondent wife the relief by way of damages for assault and battery committed by her appellant husband against her and a restraining injunction from further assaults. Harun M. Hashim and Mohd. Azmi, SCJJ. held that under Islamic Family Law Act 1984, s. 127, the Syariah Court in Kuala Lumpur have been conferred with the jurisdiction to give relief to the wife as asked for; whereas Gunn Chit Tuan, SCJ held that this law did not confer on Syariah Courts civil jurisdiction to hear an action for a tort by a wife against her husband and, therefore, it falls within Civil Court’s jurisdiction.

Harun Hashim SCJ observed that ‘when there is a challenge to jurisdiction (as here) the correct approach is to first see whether the Syariah Court has jurisdiction and not whether the State legislature has power to enact the law conferring jurisdiction on the Syariah Court.’ The suggested approach is correct because the State Law validly enacted may not confer jurisdiction on the Syariah Court over the matters Islamic. However, this observation does not mean that State Law cannot be challenged on the ground that it has no power under the Constitution to confer jurisdiction on the Syariah Court in respect of the particular matter. For making such constitutional challenges, the learned Judge did refer to Article 4(3) and (4) and Article 128 of the Constitution.

The High Court at Kuala Lumpur referred two cases for Supreme Court’s opinion on the constitutionality of the question as to whether Syariah Courts or Civil Courts have jurisdiction in respect of a non-Muslim wife’s or wife and children’s application for maintenance against their non-Muslim husbands who later became converts to Islam and pleaded that since they were Muslims now only Syariah Court and not the High Court has jurisdiction over them. The second reference was made by Wan Adnan Ismail, J. as to the validity of the maintenance order made by a Civil Court in favour of the wife and her two children. The Supreme Court answered per Tun Abdul Hamid, LP (for the Court of five judges) that the Civil Court is empowered to decide on an application by a Chinese woman for ancillary relief following her divorce from her husband who has embraced Islam. The written judgments is awaited.

Applications for writ of habeas corpus do come before the High Courts in cases of Muslim girls converting to other religions and marrying non-Muslim persons and vice-a-versa and the High Courts are called upon to exercise jurisdiction over such matters. For example in one case Faiza Tamby Chik J. of High Court at Seremban, rejected the habeas corpus application and held on merit, after interviewing the girl, that she had of her own free will embraced Islam and registered as such but now she indicated her intention to renounce Islam and directed her to meet State Religious Council (MAINS) officials to officially indicate her interest to renounce Islam.

Islamising Laws By Judges

The Courts of law in ascertaining, interpreting, expounding and applying Civil or non-Syariah Laws could be imbued with the spirit, values, purposes, basic principles and juridical as well as non-juridical concepts of Syariah as derived from or based on the injunctions of the Quran and Sunnah. Some of them that have religious spiritual content, tilt or bias may be applied only to the Muslims; whereas others non-religious or spiritual in content but constituting social and moral values ordained by Allah (SWT) purely for the benefit and well being of mankind in general can be profusely drawn upon to give a sense of direction to the judicial discretion in molding, changing and fine tuning the Civil Laws for application to all, Muslims and non-Muslims alike. That Judges do make law is no more disputable. Their creative power is limited by the existing material; they discover it, shape or mould it but cannot manufacture it. Judicial law-making takes place within certain narrow and clearly defined limits and the attention now is centred on the ways in which this occurs, and the motives, attitudes and reasoning which underlie the development of law by this means. They do it in giving meaning to the words (particularly when they are ambiguous) removing logical defects, or inconsistencies in the statute, extending laws by analogy, deducing ratio decidendi from the previous cases, supplying omissions where there is no rule of law, or in un-provided for cases.

It is idle to contend that the rules of Common Law or secular laws of the West are not structured on or have not infused into them values and ideas derived from Christian theology. According to Willis ‘Christianity is probably a part of the Common Law and a part of our (American) law.’ Justice Douglas of the US Supreme Court opined (for the majority) in Zorach v. Clauson ‘We are a religious people whose institutions presuppose a Supreme Being.’ The US Supreme Court made no pretext of it and held Christianity based laws as consistent with ‘free exercise of religion’ of their Constitution, and the ‘wall of separation between church and state’ e.g. Sunday closure, blasphemy; anti-polygamy, tax exemptions to churches. In fact some of these Common Law principles and Western ideas and concepts may be seen, though not expressly acknowledged as such, to have traces and underlying assumptions of Islamic doctrines, tenets, and values e.g. John Locke’s Social Contract theory, theory of Government of limited powers, St. Thomas Acquina’s new version of Christian doctrine of Natural Law, the idea of Governmental power being a trust, justice etc.

It is not difficult for a judicial mind nurtured in the traditions of Islamic ideals, values, and precepts to perceive the unfolding problems, social needs, and the thrust of social change against that backdrop, and seek and find in them the right solutions to the issues that come before them for resolution. This imperceptible process can be a reality. There is no need, nor it is desirable to state the source of such chosen solutions by Islamic labels.


Nizam Khan v. Add. District Judge Lyallpur, had embarked upon a thoroughly researched learned discussion on a wider spectrum to establish the point or demonstrate how the Judges imbued with Islamic values, ideas, and concepts can give a new dimension and sense of direction to the development of law and legal system at their hands. It is indeed an intellectual treat for a Muslim legal and juristic mind to read that judgment. In this case a Muslim child applied for maintenance against his grandfather of means who contested it on the ground that there is no statute law which obliges him to do so (even though he may be liable to do so under the general Muslim Law) because ‘maintenance’ was not included in the list of subjects in the West Pakistan Muslim Personal Law (Shariat) Application Act 1962 (although in the Indian counterpart of it, it is found mentioned). In matters not covered by statute law, and in the absence of recognised and established custom, the Court was directed by s. 6 of the Punjab Laws Act 1872, to ‘decide according to justice, equity and good conscience.’ The learned Judge found that originally in England ‘Justice, equity and good conscience’ only meant ‘the laws of God or Natural Law,’ and that it was later in Waghela v. Masluddin,41 the Privy Council interpreted it to mean ‘the rules of English law if found applicable to Indian Society and circumstance.’ Taking the view that this interpretation was wrong and also contrary to another Privy (Council decision in Mayor of Lyons v. East India Co., the learned Judge held that the Privy Council decision is no more binding. Notably he observed.

Islamic Banking In Malaysia

In Malaysia, Islamic banking was introduced into the banking system in 1983 with the establishment of the first Islamic Bank, the Bank Islam Malaysia Berhad (BIMB) which was incorporated as a limited company under the Companies Act 1965. In accordance with its objectives, BIMB operates its banking activities according to the Syariah principles. After more than 20 years in operation, BIMB has proved to be a viable banking institution where it has successfully expanded its activities rapidly throughout the country and introducing new products in the financial market. The Bank has also progressed tremendously as it was listed on the main board of Kuala Lumpur Stock Exchange on 17 January 1992.

The establishment of Islamic Bank in this country was made possible by the passing of the Islamic Banking Act (Act 276) (IBA) which came into force on 7 April 1983. The Act provides Central Bank of Malaysia (Bank Negara Malaysia) with power to supervise and regulate Islamic Banks, similar with other licensed banks in the country. The long term objective of the Central Bank is to create an Islamic banking system operating on a parallel basis with the conventional banking system. In order to achieve this objective, the Central Bank has adopted the approach to spread the virtue of Islamic banking by disseminating Islamic banking on nation wide basis. Thus, in 1993, commercial banks, merchant banks and finance companies were allowed to offer Islamic banking products and services under the Islamic Banking Scheme (IBS), known as “Islamic windows”. Following this, there are currently more than 40 Islamic financial products and services that may be offered by banks using various Islamic concepts such as Mudharabah, Musyarakah, Murabahah, Bai’Bithaman Ajil, Ijarah, Qardul Hassan, Istina’ and Ijarah Thumma Al-Bai’. This option was seen as the most efficient mode of increasing the number of institutions offering Islamic banking services at the lowest cost and within the shortest time frame. Ten years later, Islamic subsidiaries were introduced, with RHB Islamic Bank Bhd and Hong Leong Bank Bhd launched in 2005. Islamic subsidiaries are for all purposes treated as a full fledged Islamic bank. At this juncture it ought to be pointed out that although Islamic banking system operates on a parallel basis with the conventional banking system, in Malaysia separate Islamic legislation and banking regulations exist side-by-side with those of the conventional banking system. The license for an Islamic bank can only be granted after compliance with requirements under s. 3 of IBA 1983, whereas conventional banks obtain their license under Banking and Finance Act 1989 (BAFIA).

As is well known, the Islamic banking activities are based on interest-free and profit sharing principle. In Malaysia, the Central Bank has introduced a scheme known as Interest-free rate Banking Scheme in 1993. This is seen as in accordance with s. 2 of IBA 1983 which defines, “Islamic banking business” as banking business whose aims and operation do not involve any elements which is not approved by the religion of Islam.

The Central Bank has also established Syariah Advisory Council to monitor the practice of Islamic banking activities by all the banking institutions in Malaysia. This can be referred to under s. 16B of the Central Bank of Malaysia Act 1958 (CBA), (which is also referred to in s.124(7) of the Banking and Finance Act 1989 (BAFIA)), which provides for the establishment of a Syariah Advisory Council as the authority for the ascertainment of Islamic law for the purposes of financial business, or any other business which is based on Syariah principles and is supervised and regulated by the Central Bank. Furthermore, under s. 3(5) of the IBA 1983 every bank that wants to practice Islamic banking must establish a Syariah Advisory Body to advise the bank on the operations of its banking business to ensure that the bank complies with the “religion of Islam”. It should be noted that the Syariah Advisory Board members must be approved by the Advisory Council before a bank obtains a license to carry out Islamic banking business as this would ensure standardization. Therefore strictly looking at the BAFIA and IBA, for Islamic banks, it is mandatory that an internal Syariah Advisory Board is set up and approved by the Central Bank to obtain a license to carry out Islamic banking and financial business. However, conventional banks offering IBS are not required to establish a Syariah Advisory Board to obtain a license to carry out Islamic banking and financial business, as long as they seek the consultation of the Syariah Advisory Council (s. 124(1) of the Banking and Finance Act 1989 (BAFIA). Nevertheless, even though there is no mandatory requirement that conventional banks offering IBS have Syariah Advisory Boards, it would seem that they do in practice have Syariah Advisory Committees or Consultants.

Islamic Banking Litigation

On the aspect of litigation in solving disputes or disagreements arising concerning any product offered by the Islamic banking system, the court of law that resolves these disputes or disagreements are the civil court and not the Syariah court. This was established by the High Court judgment in the case of Bank Islam Malaysia Bhd v. Adnan bin Omar. A detail discussion on this point will be elaborated below.

In this case five issues have been raised, and amongst them is whether civil courts have jurisdiction over Islamic banking. The defendant argued that since BIBM (‘the plaintiff’) is an Islamic bank, the civil court has no jurisdiction to hear the case in view of art. 121(1A) of the Federal Constitution. The judge, NH Chan J (as he then was) overruled that objection and held that the matter was rightly brought before the civil court. It was submitted that List 1 of the Ninth Schedule enumerates the various matters on which Parliament can enact laws. The scope is very comprehensive and includes banking and the constitution, organization, jurisdiction and powers of all courts other than Syariah courts and native customary courts. List II in the State List provides for the constitution, organization and procedure of Syariah courts, which shall have jurisdiction only over persons professing the religion of Islam and in respect only of any of the matters included which exclude Islamic banking. It was further argued that since BIMB is a corporate body, therefore it does not have a religion, and such, it is not within the jurisdiction of the Syariah courts. As such, civil courts have jurisdiction to hear Islamic banking and other Islamic commercial cases based on the following grounds:

  1. The Syariah courts can only decide cases that fall under the State List that excludes cases relating to commercial laws such as Islamic banking.
  2. The Syariah courts can only decide the case when all the parties are Muslims. As such, Islamic institutions such as BIMB and Syarikat Takaful are corporate institutions created by statute and do not have a religion; and

Currently, the application of English law in Malaysia is based on the provisions of ss. 3 and 5 of the Civil Law Act 1956. Section 5 of the Act provides that, in matters of mercantile law or commerce, English law is to be applied. As such, the jurisdiction is certainly vested in the civil courts. In addition, s. 3 of the Act provides for the application of the English law and rules of equity when there is a lacuna in the provision of any written law. In Malaysia, although there is the IBA, but as mentioned earlier, the Act is not exhaustive. Thus, any ambiguity, clarifications and interpretation will be referred to the civil courts.

In the latter case of Dato’ Haji Nik Mahmud bin Daud v. Bank Islam Malaysia Bhd12 the appellant raised two issues. The first was that the respondent was at all material times prohibited from accepting charges in respect of usury transactions. In consequence, the acceptance of the charges by the respondent in this instance was ultra vires its articles of association. However, this issue was abandoned at the outset of the hearing. The Court of Appeal only addressed the second issue raised by the appellant that the execution of the agreements had contravened the provisions of ss. 7(i) and 12 of the Malay Reservations Enactment 1930 of Kelantan (‘the Enactment’) and accordingly the dealing was null and void and the creation of the charges should be set aside. It was further submitted that the word ‘transfer’ in s. 7(i) of the Enactment is capable of a wider sense and there is no necessity for a physical transfer. The learned Court of Appeal judge dismissed the application. Clearly, the civil court judges did not take into consideration that the transaction involved the element of usury and the respondent as an Islamic bank, should not be involved with that kind of transaction.

Based on the case mentioned above, it is important that the case of Islamic banking should be brought within the ambit of Syariah Courts so that the understanding and the true spirit of Islam would be recognized by the court. However, as of today, the law (that the jurisdiction is under civil courts) is as what has been decided by the Honorable Dato’ Abdul Hamid Mohamad JCA in the case of Bank Kerjasama Rakyat Malaysia Bhd. v. Emcee Corp Sdn Bhd;

As was mentioned at the beginning of this judgement the facility is an Islamic banking facility. But that does not mean that the law applicable in this application is different from the law that is applicable if the facility were given under conventional banking. The charge is a charge under the National Land Code. The remedy available and sought is a remedy provided by the National Land Code. The procedure is provided by the Rules of the High Court 1980. The court adjudicating it is the High Court. So, it

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The emergence of Islamic jurisprudence (fiqh) also goes back to the lifetime of Muhammad. In this view, his companions and followers took what he did and approved of as a model (sunnah) and transmitted this information to the succeeding generations in the form of hadith.

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