Islamic Banking in J&K soon? High Court gives 4 Weeks to Govt To Respond

A Public Interest Litigation (PIL) seeking the introduction of Islamic Banking in Jammu and Kashmir, is gaining momentum as High Court of J&K and Ladakh Wednesday granted four more weeks time to to government to respond to the PIL.

Reserve Bank of India (RBI) and J&K Bank has already responded to the PIL.

A division bench of Justice Ali Muhammad Magrey and Justice Sanjay Dhar asked the government to file the “counter” within four weeks after additional advocate general M A Chashoo requested for more time for the same.

The Court listed the PIL for further consideration on December 8.

In August this year the Court had observed that despite time was allowed on March 26 to the government for filing counter affidavit, the same had not been filed. The Court had granted to the government a further period of one month as final opportunity to file the counter.

The PIL filed by an NGO J&K Peoples Forum in 2018 is seeking directions to union finance ministry for issuing necessary notification for the introduction of Sharia compliant windows (Islamic banking) as recommended by Deepak Mohanty Committee as well as in the light of a report of the inter-departmental group of RBI.

The Forum also seeks direction to RBI for taking immediate steps in the constituent banks including the J&K Bank so as to facilitate Shariah compliant windows.

The Forum wants J&K Bank Limited to place before the court entire details of Non Performing Accounts (NPAs) and the steps taken for recovery of the outstanding amount in NPAs, saying the same is public money which cannot be allowed to be misappropriated either by the account holders or by the management of the bank.

The Forum also seeks direction to J&K Bank to take immediate steps for opening of Shariah compliant windows to accomplish the object of mass level participation in Shariah Banking.

The petitioner submits that “majority of the citizens in Jammu and Kashmir are Muslims by faith and thus have a constitutional right to enjoy all avenues of development provided the same do not contravene the article of their faith”.

The petitioner has cited the Holy Quran as well as commandments of Prophet Muhammad (SAW) prohibiting interest. “It is of common knowledge that receiving and giving of interest (Riba in Quranic parlance) besides being prohibited for Muslims is widely disliked by other faiths as well,” the Forum said.

“In Hinduism it is said that Brahmana and a Kshatriya shall not lend anything at interest.” The Forum submits that even the United Nations has acknowledged the role of Zakat in supporting the Sustainable Development Goals (SDG).