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Salam Cancellation
A Salam contract may be cancelled based on mutual agreement between the contracting parties, and the price of the subject matter may be returned to the buyer. A par...
 
Change In Subject Matter Of Salam
The subject matter may be changed at the time of the contract's maturity and not before based on the following conditions: 1. Provided the option of change is not stipulated as a condition at the time of the contract's execution. 2. The replacement commodity is permissible to establish as the subject matter of the Salam. 3. The market value of the replacement commodity is equivalen...
 
Price Hike At Time Of Delivery In Salam Contract
The seller is bound to deliver the goods without demanding any excess money, since t...
 
Salam: Forward Sales
A Salam transaction is a means by which party A advances money, in full and on spot, to party B, and party B promises to deliver an item on a specified date in the future. The Prophet (Allah bless him and give him peace) said: "Whoever wishes to enter into a contract of Salam, he must effect the Salam according to the specified measure and the specified weight and the specified date of delivery.” A Salam is the exception to the Islamic rule forbidding forward sales and stipulating that party B possess the item to be sold in the present. The Salam agreement has the dual benefit of providing liquidity to party B, who normally would not realize any income until he invests large sums of capital in advance over extended periods of time, like farmers preparing seasonal crops; and benefiting party A because the Salams a...
 
Default In Delivery Of Salam Subject Matter
If at maturity the seller is unable to deliver the subject matter, the buyer may exercise one of the following three options: 1. Wait until the seller is able to make the delivery. 2. Cancel the sale and ask for a refund of the or...
 
Delay In Delivery Of Salam Subject Matter
If the seller is unable to deliver the subject matter at maturity, the buyer may grant him respite. A penalty may not be ...
 
Salam For Precious Metals
Salam transactions are typically for fungible items. According to AAOIFI Shariah Standard No. 10 “Salam and Parallel Salam,” section 3/2/4: “It is not permissible for al-Muslam fihi to be an amount of currency or gold or silver, if the cap...
 
Selling Goods Bought Under Salam Contract Before Delivery
It is not permitted for the buyer of goods under a Salam contract to sell goods before t...
 
Considering A Previous Loan As Price For Salam
In case a loan has been advanced from one party to another, it is permissible for the Salam purc...
 
Permissibility Of Providing Security In Salam Contract
The buyer in a Salam contract may ...
 
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