Sale of Assets on Liquidation Basis in Islamic Banks

Abstract

Profit and loss distribution in Islamic banks is done in different ways depending on different necessities. One method of profit and loss distribution in Islamic banks is based on daily product basis. Similarly, profit is distributed in Islamic banks according to the weightages assigned to the depositors. Likewise, one method adopted by Islamic banks for sale of assets and consequent distribution of profit and loss is on the basis of constructive liquidation, in which the distribution of assets is not done physically and actually but according to the estimated cash value of the asset. The discussion in this article belongs to this category i.e. constructive liquidation of the assets. In the context of modern age and current situation, after analyzing the two opinions of the jurists in this regard, one opinion has been preferred.