Filter by Categories
Accounting
Banking

Islamic Finance




Difference Between Constructive Possession and Physical Possession


Constructive possession (qabd hukmi) is the process or act or state of a party/ person having the legal rights over an asset, without having its in his/ her actual possession. On the other hand, physical possession is the actual possession of an asset in addition to the legal rights to control that asset.

For example, in a murabahah contract (aqd al-murabahah), the seller is required to have physical or constructive possession of the object of murabahah for the contract to be valid and permissible from a shari’ah point of view. Constructive possession is to be proven based on a material evidence of effective transfer of ownership or receipts such as warehouse receipts.



Tutorials
This section contains quite a vast collection of easy-to-understand explanatory manuals, practical guides, and best practices how-tos covering the main themes of this ...
Watch on Youtube
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments