BAI SALAM,BAI ISTISNA AND

BAI AL-INAH

PREPARED BY: NUR ALIA BINTI AZMAN

:NUR NASUHA BINTI MOHD FADZLI


DEFINITION
PILLARS OF ISLAM
OBJECTIVE BAI SALAM
CONDITION BAI OF SALAM
 INTRODUCTION

This contract is crucial during the time of Prophet hood and

at the time the agriculture sector become outstanding and
supreme.
The wisdom of making salam permissible lies in the fact
that salam facilities a types of financing for people in need
of it.
By using Salam contract, the buyer may benefit from it
permissibility as well, by acquiring the commodityat at a
price below the price market.
 Definition

Literally, salam mean giving (ita), advance (taslif), and leaving.

Technically,
Sales contract over prescribed commodity sold as a deffered liability on one
party, in exchange a price that is received during the contract session.
Maliki defined it as a sale in which capital sum (price) is paid in
advance and the object of sale is deffered to a specified term.
AAOIFI defined salam as the purchased of commodity for deffered
delivery in exchange for immediate payment.
 Bai as-Salam or Salam means a contract in which advance cash
payment is made for goods to be delivered later on .
The seller undertakes to supply some specific goods to the buyer at the
future date in exchange of advance price fully paid at the time of
contract
Salam also know as sales by order.
 PILLARS OF AS-SALAM

Rabb as-Salam/ Musallim

The Buyer
Muslam Iiaihi
The Seller

Al Musallim Fih
The Product

Sighah
Ijab (Offer)

Qabul (Acceptance)
 OBJECTIVES OF BAI SALAM

Provides the financing for small and medium

entrprises .
The economic reality underlying the contract of Salam, the ordering of
goods to be delivered laters for a price paid in advance , was the
financing of the business of a small trader or artisan by his customers .
Benefits the trader or producer
Provides Islamically accepted financing alternative and avoid any
involvement in riba.
Benefits the purchaser
Provides goods and products at a discounted price in return for the
willingness of the purchaser to help the financing of the business
venture .
FLOW OF BAI SALAM
 TYPES OF SALAM CONTRACT

Ordinary salam contract Parallel salam contract

o The normal salam contract that
o Contractrual agreement consists
involves two transacting parties,
of two different and independent
the buyer (musallim) and the seller
contracts one in which the bank is
(musllam ilayh)
a buyer and the other in which the
bank is a seller .
o The two contract cannot be tied up
and performance of one contract
should not be contigent upon the
other .
 CONDITIONS OF SALAM

Conditions related to the purchased commodity (mussalam

fih)
Salam can be effected on commodity whose quality and
quantity can be clearly specified,commodities which quality
and quantity cannot be specified cannot be sold through
salam.
The commodity must be vastly available in the market at
the time of contract until the time of delivery , to ensure the
capability of the trader to deliver the product .
The quantity , weight and measure of the commodity must
be agreed upon in equivocal terms.
Conditions of Bai -Salam
 Definition

Literally :
The word istisna derived from the arabic verb
istisnaa which is mean to request someone to
manufacture an asset.
Technically:
Bay al-istisna is defined as a contractual agreement
with manufacturer to produce items with specified
description at a determined price and manufactured
from his own materials with his own effort.
 Pillars of Istisna
Mustasni
- Customer

Sani
- Manufacturer

Ras al-mal
- The price

Masnu
- The product

Sighah
-Ijab ( offer )
-Qabul ( Acceptance )
FLOW OF ISTISNA
TYPES OF ISTISNA CONTRACT
 Condition of Istina

Condition of subject matters ( masnu)

The object to be manifactured must be precisely determined in its type,

kind , quantity and quality , considering that istisna, contact is aform of
sale of the non-existence.
The object of an istisna contact must be something that the people are
familiar with to contract it on the basis of manufacture and contruction
process.
Istisna contract always associated with the risk of uncertainty of
deliverability of the subject matter which can be mitigated through the
above said mechanism .
Condition of Istisna
Differences Between Al-Istisna and Salam
Applications
Parallel Istisna ( Istisna Mawazi )
 Definition Bai Inah

Literally:

Loan or advanced payment

Techincal :

The selling of an asset with a mark up price on deferred

payment, with the intention to sell the same assset to the
debtor with lower cash price , which is means to settle his
debt .
 Evidence

Hadith

Rassullah (S.A.W) has ordered Amru ibn al As to prepare

the army for the battle. He then purchased a camel in
exchange for a delayed payment of 2 camels

Narrated by al- Bukhari

 Pillars of Bai-Inah

Seller and buyer

Merchandise / Goods
Price
Sighah
Flows of Bai-inah
Opinion of scholars
Applications