The central bank Monday amended and relaxed the regulations requiringIslamic banks to obtain invoices in the name of respective bank in Murabaha transactions. Considering the practical difficulties in obtaining invoices, particularly, in transactions like purchase of phutti, raw hides, milk, sugarcane etc. the instructions on obtaining invoices have been reviewed and amended, said an SBP circular issued Monday. It said that the invoice issued by the supplier shall be in the name of Bank- Account Client e.g. “1st Islamic Bank – ABC Company”.
In case where obtaining invoice in the name of IBI is not possible, the invoice in the name of client may also be acceptable, subject to specific approval of the Shariah Advisor, for all such transactions. In transaction where obtaining formal invoice either in the name of bank or the client is not possible, then the document or combination of documents like Truck Receipts, Delivery Note, Goods Received Notes, Physical Inspection Report, Kachi Parchi, Inward Gate Pass etc having particulars (i.e. names of buyer and seller, date of purchase/delivery, description of goods, quantity and purchase amount, etc) may be accepted in lieu of invoice with the approval of Shariah Advisor.
The Shariah Advisor while approving any transactions as mentioned in Para (i), (ii) above, shall document the reasons, industry norms etc. due to which obtaining invoice and/or making payment directly to the supplier is not possible.
He shall also review and approve the process flows etc to be adopted by the client/IBI to execute such transactions. The Shariah Advisors shall also, either on their own or through suitably trained staff of the IBIs, make onsite verifications of such transactions on sample basis. The payment for Murabaha transactions shall either be made directly to supplier or credited in an escrow account by the IBIs.
