This document reviews investment documentation from a Shariah perspective. It discusses various documents that are usually obtained from investment clients by Islamic banks in Bangladesh. These include promissory notes, agreements, guarantees, charge documents, mortgage documents, insurance policies, and other legal documents depending on the type of client and security provided. The document emphasizes obtaining all necessary documents to clearly establish the rights and responsibilities of both parties in a Shariah compliant manner. It also references verses from the Holy Quran regarding documentation of financial transactions and obligations under Islamic law.

1. Review of Investment Documentation:
Shariah Perspective
Presented by
Md. Fariduddin Ahmed
Advisor
Export Import Bank of Bangladesh Limited
Former
Managing Director & Chief Executive Officer
Islami Bank Bangladesh Limited
Export Import Bank of Bangladesh Limited

2. The following charge documents and mortgage documents
are usually obtained from the investment clients by the
Islamic Banks in Bangladesh.
1.01 Single Party D.P. Note
1.02 Double Party D.P. Note, if there is a Guarantor, to be made by
the Client in favour of the Guarantor and endorsed by the
latter in favour of the Bank.
1.03 Joint and Several D.P. Note signed by all the Directors in case
of Limited Company.
1.04 D.P. Note Delivery Letter duly signed by the maker and the
endorser (the Client and the Guarantor).
1.05 Letter of Instalments if sale price is payable on instalments.
1.00 Charge Documents:
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Review of Investment Documentation: Shariah Perspective
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3. 1.06 Agreement for Pledge of Goods.
1.07 Trust Receipt duly executed by the Client if goods delivered
under TR.
1.08 Letter of Hypothecation for Client's Stock in Trade/Work-in-
Process, if the Investment allowed additionally secured by
Hypothecation of Stock/Stock-in-trade.
1.09 Investment Agreement.
1.10 Letter of Guarantee signed by the Guarantor as per terms of
sanction.
1.11 Insurance Policy (If the goods are stored in Party's Godown/
Yard under Bank's effective control).
1.12 Letter of Disclaimer, if stored in Party's own/ hired godown.
1.13 Balance Confirmation Letter.
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4. 2.0.1 If the Investment is made collaterally secured by Mortgage
of Property, obtain the following documents:
2.1.1 In case of Equitable Mortgage, Memorandum of Deposit of
Title Deed (MDTD) signed by the owner of the property.
2.1.2 In case of Legal Mortgage, Registered Mortgage Deed should
be obtained.
2.1.3 Personal Guarantee of the owner(s) of the Property.
2.1.4 Original Title Deed(s) with CS. RS, SA,. Mutation Parcha, DCR
of the property and Mutation record.
2.1.5 Up-to-date Rent Receipts.
2.1.6 Non-encumbrance Certificate along with Search Fee Paid
Receipt.
2.0.0 Mortgage Documents:
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5. 2.1.7 Site Plan (MAP/Naksha) of the proposed mortgage property.
2.1.8 Valuation Certificate (issued by a competent Civil Engineer
and physically verified by the Branch Officials) countersigned
by the Manager certifying the Market value and the Forced
sale value. Value of the Land and value of the Construction to
be shown separately taking the depreciated value of the
Construction/Building into consideration as per standard
norms.
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6. (Valuation Certificate should be self contained giving full
particulars of the land, i.e. Dag/Plot Number, Khatian
Number, Holding Number, Mouza Number and name of the
Mouza, Schedule (Chowhaddi), mentioning the name of the
owner(s) of the Land/ Building along with a Site Plan duly
signed by the owner(s) of the Property & the Client and
attested by a Civil Engineer & the Branch Manager).
2.1.9 Lawyer's Certificate about verification of the Title Deed (the
Lawyer should certify in clear terms that the Property
covered by the Title Deeds is free from all encumbrances and
the same can be accepted as collateral security against the
particular Investment.) Legal Opinion should be self-
contained without any ambiguity and clean in all respects.
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7. 2.1.10 An affidavit sworn in before a 1st
Class Magistrate by the
owner of the property to the effect that the property offered
for mortgage as security is free from all encumbrances and
the owner(s) is/are lawful owner(s) in possession and he/
she/they will not Encumber/Transfer/Sale and/or Charge the
Property in any manner whatsoever to others during the
continuance of Bank's Investment without prior written
clearance of the Bank.
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8. 2.2.0 Where the Investment is secured by hypothecation of Stock-
in-trade, Machineries etc., also obtain the following
Documents:
2.2.1 Letter of Hypothecation for Client’s Stocks-in-Trade/ Work-
in-Process/Stores/Mills & Machineries etc.
2.2.2 Trust Receipt.
2.2.3 Legal Mortgage of Machineries with full details of each
Machinery in seriatim.
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9. 2.3.0 In case Investment is Collaterally/Additionally secured by
Pledge of Shares of reputed Public Limited Company on
Bank's approved list and quoted in the Stock Exchange, the
following additional Documents are to be obtained:
2.3.1 Agreement for Pledge of Shares along with original Share
Certificates (No share in the name of minor shall be accepted
as security).
2.3.2 Share Transfer Deed in Duplicate - one copy signed, dated
and another copy signed undated.
2.3.3 Share Delivery Letter addressed to the Bank.
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10. 2.3.4 Letter to the concerned Company to register Lien in Bank's
favour.
This notice shall be sent by Registered Acknowledgement Due
Post (Registered A/D Post) and confirmation of recording the
Lien shall be obtained from the concerned Company.
2.3.5 Letter of Authority in Bank's favour duly signed by the share
holder to collect Dividend and Bonus on his behalf of the
Share pledged to the Bank.
2.4.0 In case of Investment to Partnership Firms, obtain the
following Documents:
2.4.1 Letter of Partnership signed by all Partners.
2.4.2 Copy of Partnership Deed duly attested by the Incumbent-in-
charge of the Branch.
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11. 2.5.0 In case of Investment to Private or Public Limited Company,
obtain the following additional Documents:
2.5.1 Certified copy (duly certified by the Registrar of Joint Stock
Companies & Firms) of the Memorandum and Articles of
Association to ensure that the Company has necessary power
to borrow/take Investment from any Bank.
2.5.2 Resolution of the Board of Directors of the Company to do
business and authorising the office bearers to execute
necessary documents.
2.5.3 Personal Guarantee of all the Directors of the Company.
Review of Investment Documentation: Shariah Perspective
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12. 2.5.4 If the Investment is allowed on Hypothecation basis, in
addition to other Charge Documents, 1st charge under
relevant section of the Company's Act-1994 shall be created
in Bank's favour in respect of Company's Assets prescribed as
security.
This charge shall be created with the Registrar of Joint Stock
Companies and firms within 21 days from the date of
execution of the relative Charge Documents.
2.5.5 Certificate issued by the Registrar of Joint Stock Companies &
Firms under section 114 of the Companies Act, 1994 in
respect of creation of Charges.
Review of Investment Documentation: Shariah Perspective
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13. 2.5.6 Copies of Memorandum and Articles of Association with
latest amendments, if any, duly certified by the Registrar of
Joint Stock Companies & Firms and attested by the Managing
Director on every page with Official Seal of the Company duly
verified by the Branch Incumbent/ Authorised Official.
2.5.7 A certified copy of Certificate of Incorporation.
2.5.8 A copy of Certificate of Commencement of Business in case of
Public Limited Company.
Review of Investment Documentation: Shariah Perspective
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14. 2.6.0 In case of Investment to a Trust Organisation obtain the
following Documents in addition to other Charge
Documents:
2.6.1 Copy of Trust Deed duly attested by a 1st class gazetted
officer and verified by the Incumbent-in-charge of the Branch
with the original copy. The Trust Deed must have power to do
business with Banks.
2.6.2 Resolution of the Board of Trustees to do business with the
concerned Bank.
2.6.3 Charge Documents shall be signed either by persons
authorised by all members of the Trust Committee, if
Trustees are authorised to delegate their powers by the
Trust Deed or all of the Trustees.
2.6.4 Personal Guarantee of all the Office Bearers of the Trust in
their personal capacity
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15. 2.7.0 In case of Investment to Co-operative Society, obtain the
following documents also:
2.7.1 Clearance from the Registrar of Co-operative Societies for
doing business with Islami Bank Bangladesh Ltd.
2.7.2 Letter to be issued to the concerned Registrar of Co-operative
Societies under Registered A/D Mail informing about Bank's
allowing of Investment/Facility to the concerned Society as
per clearance accorded by him.
2.7.3 Personal Guarantee of the Office Bearer of the Society in
their personal capacity.
2.7.4 A copy of Bye-laws of the Society duly certified by the
Registrar of the Co-operative Societies.
Review of Investment Documentation: Shariah Perspective
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16. 3.01 Sura Baqara: Ayat No. 282:
‡n gyÕwgbMY! †Zvgiv hLb G‡K A‡b¨i mwnZ wba©vwiZ mg‡qi Rb¨
F‡Yi Kvievi Ki ZLb Dnv wjwLqv ivwLI; †Zvgv‡`i g‡a¨ †Kvb
†jLK †hb b¨vh¨fv‡e wjwLqv †`q; †jLK wjwL‡Z A¯^xKvi Kwi‡e
bv| †hgb Avj­vn& Zvnv‡K wk¶v w`qv‡Qb, myZivs †m †hb
wj‡L; Ges FYMÖnxZv †hb †jLvi welqe¯‘ ewjqv †`q Ges Zvnvi
cÖwZcvjK Avj­vn&‡K fq K‡i, Avi Dnvi wKQy †hb bv Kgvq;
wKš‘ FYMÖnxZv hw` wb‡ev©a A_ev `ye©j nq A_ev †jLvi
welqe¯‘ ewjqv w`‡Z bv cv‡i Z‡e †hb Zvnvi AwffveK b¨vh¨fv‡e
†jLvi welqe¯‘ ewjqv †`q| mv¶x‡`i g‡a¨ hvnv‡`i Dci †Zvgiv ivhx
Zvnv‡`i g‡a¨ `yBRb cyi“l mv¶x ivwL‡e, hw` `yBRb cyi“l bv
_v‡K Z‡e GKRb cyi“l I `yBRb ¯¿x‡jvK; ¯¿x‡jvK‡`i g‡a¨
GKRb fyj Kwi‡j Zvnv‡`i GKRb AciRb‡K ¯§iY KivBqv w`‡e|
mvw¶MY‡K hLb WvKv nB‡e ZLb Zvnviv †hb A¯^xKvi bv K‡i|
Bnv (FY) †QvU nDK A_ev eo nDK, †gqv`mn wjwL‡Z †Zvgiv
†Kvbiƒc wei³ nBI bv| Avj­vn&i wbKU Bnv b¨vh¨Zi I cÖgv‡Yi
Rb¨ `„pZi Ges †Zvgv‡`i g‡a¨ m‡›`n D‡`ªK bv nIqvi wbKUZi;
wKš‘ †Zvgiv ci¯úi †h e¨emvi bM` Av`vb-cÖ`vb Ki Zvnv †Zvgiv
3.00 The Holy Quran about Documentation of Loan
Transaction
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17. hw` †Zvgiv md‡i _vK Ges †Kvb †jLK bv cvI Z‡e
n¯ZvšZiK…Z eÜK ivwL‡e| †Zvgv‡`i G‡K Aci‡K wek¦vm
Kwi‡j, hvnv‡K wek¦vm Kiv nq, †m †hb AvgvbZ cÖZ¨c©Y
K‡i Ges Zvnvi cÖwZcvjK Avj­vn&‡K fq K‡i| †Zvgiv mv¶¨
†Mvcb KwiI bv, †h †Kn Dnv †Mvcb K‡i Aek¨B Zvnvi AšZi
cvcx| †Zvgiv hvnv Ki Avj­vn& Zvnv mwe‡kl AewnZ|
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3.02 Sura Baqara: Ayat No. 283:
The Holy Quran about Documentation of Loan Transaction

18. Thanks for your
Co-operation