Abstract:

Islamic Banking is called Sharīᶜah compliant banking as all transactions conducted in the banking transaction starting from product offering stage until the dispute resolution stage shall comply with the principles of Islamic law. It is not only the regulatory laws of the land that will be applicable to Islamic banking, but all the substantive and adjective laws of the land in which the transaction occur will apply too. As such the objective of this paper is to find out the application of parol evidence rule to Islamic banking in Malaysia and to find out whether the application of parol evidence is compliant with the principles of Islamic law or not. The reason why Malaysia is taken as a case study in this case is when it comes to Islamic banking, Malaysia is considered as the cranium of Islamic banking in the world. Reference to reported cases studies on issue will be made in this research. It is anticipated that the outcome of this research will assist to understand that not all conventional laws are alien to Islamic law.