A HISTORY OF PHILANTHROPIC FOUNDATIONS: THE ISLAMIC WORLD FROM

THE SEVENTH CENTURY TO THE PRESENT

BY
MURAT ZAKA
ECONOMICS DEPARTMENT
BOGAZICI UNIVERSITY
ISTANBUL

EIGHTH DRAFT

TABLE OF CONTENTS
Acknowledgements
Chapter One: Economic Dimension and Origins
I. Introduction
II. Economic Dimension
III. The Origins
IV. Impact on Others
Chapter Two: Functioning of the System and Judicial Problems
I. The Founders
1. The Ten Conditions
II. Beneficiaries and the Family Waqf Controversy
III. The Trustees (mutawallis)
IV. The Original Capital of the Endowment (Corpus)
Chapter Three: Cash Waqfs in the Islamic World
I. Legal Issues
1. Introduction
2. The Hanafi Position on the Waqf of Movables (Cash Waqfs)
3. The Shafii Position
4. The Maliki Position
5. The Hanbali Position
6. The Shiite Position
II. Cash Waqfs in History and Present
1. Introduction
2. Cash Waqfs in the Ottoman Economy
3. Decline of the Ottoman Cash Waqfs
4. Cash Waqfs in Syria
5. Cash Waqfs in Egypt
6. Cash Waqfs in Central Asia
7. Cash Waqfs in India
8. Cash Waqfs in Malaysia and Singapore
Chapter Four: Centralization of the Waqf System
I. Introduction
II. Centralization in the Ottoman Empire and Turkey
1. The Turkish Republic
2. Survival and Restoration of Waqfs in Turkey
III. Egypt
1. Egyptian Waqfs Under the Mamluks
2. Egyptian Waqfs Under the Ottomans
3. Crises in the Late Ottoman Era and the Republic
IV. The Sudan
V. Morocco
VI. Iran
VII. India
1. Introduction
2. Legal Issues
3. The Central Waqf Act, 1954
4. Taxation of Waqfs in India
5. The Waqf Act, 1995

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VIII. Waqfs in Pakistan and Bangladesh
IX. Waqfs in Malaysia and Singapore
1. Introduction
2. Legal Issues
3. Waqf Administration in Malaysia
X. Waqfs in Philippines
XI. Conclusion
Bibliography
Glossary
General Index

ACKNOWLEDGEMENTS
This book has been written during a sabbatical leave. I am grateful to my colleagues
at Bo azii University, Istanbul, for granting me this precious opportunity.
I spent the first part of my sabbatical leave at the International Institute of Islamic
Thought and Civilization (ISTAC) in Kuala Lumpur, Malaysia. This was the second time
Professor Dr. Syed Muhammad Naquib al-Attas, the Founder-Director of ISTAC, had invited
me to his institute and so my foremost thanks go to him. Actually, it is becoming habitual for
me to thank Professor al-Attas, for it was in the same institute, even in the same room, that I
had completed the first draft of my previous book A Comparative Evolution of Business
Partnerships a few years ago. By a marvellous coincidence, the published version of it was
handed to me by the postman the day I arrived at ISTAC for my second sabbatical. I thought
this was a good sign and started my work on the present book with renewed vigour.
I fully utilised everything ISTAC had to offer: I greatly benefited from the superb
library and would like to thank particularly Haji Ali Haji Ahmad, the Chief Librarian, for his
friendly support. I was constantly encouraged and supported by my colleagues at ISTAC.
Special thanks are due to Professors Alparslan Akgen, Wan Mohd Nor Wan Daud
(ISTACs Acting Deputy Director), Teoman Dural, Mehmet p irli, Bilal Ku pnar and Sabri
Orman for their constant encouragement and constructive criticism. Professor Ahmad
Kazemi Moussavi played a special role in obtaining information for me on the current laws
pertaining to waqfs in the Islamic Republic of Iran. I would like to thank, in the same context,
H.E. Ali Reza Dardmand, Cultural Attach, Embassy of the Islamic Republic of Iran in Kuala
Lumpur, and the authorities in the Endowments and Charity Affairs Organisation in Teheran,
Iran.
In Kuala Lumpur I found support from sources outside ISTAC as well. Royal
Professor Ungku Abdul Aziz shared with me his precious time and knowledge. Dr. Zeti
Akhtar Aziz, Assistant Governor of the Central Bank of Malaysia, allowed me to interview
bank officials. Professor Ahmad Ibrahim of the International Islamic University, Malaysia
introduced me to his important work on the present situation of waqf law in Malaysia.
Professor Syed Khalid Rashid of the same university and an authority on the history of the
Indian waqf system, generously gave me his time and read the part on Indian waqfs. I also
benefited greatly from the research papers by my students participating in the Poverty
Alleviation seminar. Some of the papers written by these young scholars were so original and
important that I have not hesitated to refer to them in this book.
Professor Faruk Bilici of Institut National des Langues et Civilisations Orientales
provided support all the way from Paris and, my sister, Professor Dr. i dem Ka tba of
Ko University, Istanbul, sent me important material concerning the well-known Vehbi Ko
Foundation. After having returned to Turkey, I have had the opportunity to interview Rahmi
Ko, Aydn Bolak, Turhan Esener and Erdal Yldrm about the Vehbi Ko Foundation as
well as the drafting of the 1967 Law. I am grateful to all of them.
Special thanks are also due to Sharifah Shifa al-Attas, General Editor of ISTAC, and
Aida Melly Tan Mutalib, Editorial Assistant, as well as Sylvia Jones who read the entire
manuscript and made innumerable corrections. While I am grateful to all of these colleagues,
it goes without saying that I, alone, bear all the responsibility for any shortcomings and
mistakes.
Finally, I would like to thank my wife, Kitty izaka for reading the entire
manuscript and sharing my life, together with my daughter Defne, in Kuala Lumpur.

TO THE FOUNDER-DIRECTOR, FACULTY AND STUDENTS OF ISTAC

NOTES ON TRANSLITERATION AND PRONUNCIATION

All foreign words, excluding foreign names, are italicised except the word waqf and its plural
awqaf. These words appear so frequently throughout the text that it has been decided not to
italicise them. Although I have generally preferred for the plural, waqfs rather than the
Arabic plural awqaf, I have occasionally used the latter in order to avoid repetition. Most
transliterations follow modern Turkish spelling, even for words, which originated in Arabic
or Persian. If such words, however, have become part of English in their Arabic versions,
then their Arabic transliteration has been preferred. Thus, waqf (and not vakf) has been
used. Turkish words, which have become anglicised, have been kept in the latter form. Thus
pasha (and not Pasha) has been used. For those who are unfamiliar with the pronunciation of
modern Turkish spelling, the following rudimentary rules (according to Geffery Lewis
grammar) may be of some help: c is pronounced j as in jam; is pronounced ch as in church;
g is pronounced as in the word goat; lengthens the vowel preceding it; y sounds like the u
in radium; and as in German knig and fhrer respectively; and is pronounced as in sh
in shall.

LIST OF TABLES

Table 1: Waqf Properties in Turkey

Table 2: The Public Awqaf in Sudan
Table 3: Sudanese Awqaf in Eight States
Table 4: Number of Waqfs in India
Table 5: Increase in Real Total Revenue for the Awqaf Department Punjab

CHAPTER ONE: ECONOMIC DIMENSION AND ORIGINS

CHAPTER ONE: ECONOMIC DIMENSION AND ORIGINS

I. Introduction
Philanthropic foundations are known in the Islamic world as waqf or habs. Whereas
the latter term is used primarily in North Africa, the former is known, with slight variations,
in the rest of the Islamic world. The word waqf and its plural form awqaf are derived from
the Arabic root verb waqafa, which means to cause a thing to stop and stand still. A second
meaning is simply philanthropic foundations.
However defined, this institution, whereby a privately owned property, corpus, is
endowed for a charitable purpose in perpetuity and the revenue generated is spent for this
purpose, stands out as one of the greatest achievements of Islamic civilization. All over the
vast Islamic world, from the Atlantic to the Pacific, magnificent works of architecture as well
as a wealth of services vitally important to the society have been financed and maintained for
centuries through this system. It has even been argued that many waqfs had survived for
considerably longer than half a millennium and some even for more than a millennium
(Crecelius, 1995: 260).
Despite these overwhelming achievements, the history of waqfs is a turbulent one.
For centuries the fate of these institutions was closely linked to the fates of the states under
which they functioned. Consequently, they experienced dramatic ups and downs: the period
of establishment and growth was often followed by one of decline and neglect until with a
new state emerging, renewal and prosperity once again prevailed.
Nowhere in this long history of fluctuations, however, did the waqfs experience the
universal and deliberate destruction that was inflicted upon them during the nineteenth and
twentieth centuries, a fact which pinpoints, of course, to western imperialism as the culprit.
Yet, the greatest destruction took place not in a region colonised by the great powers, but in
Turkey, one of the rare countries in the Islamic world, which was not colonised. This
paradox, among other things, will be addressed later.
II. Economic Dimension
Although this book will deal primarily with the economic history of the waqf
system, it is appropriate to point out briefly the relevance of the waqf system for modern
Islamic societies. Indeed, economists looking at the waqf system would be perplexed by the
fact that a myriad of essential services such as health, education, municipal, etc., have
historically been provided at no cost whatsoever to the government. Therefore, ceteris
paribus, the waqf system can contribute significantly towards that ultimate goal of so many
modern economists: massive reduction in government expenditure, which leads to a smaller
budget deficit, which in turn lowers the need for government borrowing thus curbing the
crowding-out effect and leads to a reduction in the rate of interest, consequently reining in
a basic impediment to private investment and growth.
The waqf could fulfil these above-mentioned functions by voluntary donations made
by the well to do. Thus, privately accumulated capital is voluntarily endowed to finance all
sorts of social services to the society. At this point another extremely important function of
the waqf becomes apparent: not only does it help reduce government expenditure and
consequently the rate of interest and pave the way for growth, it also achieves another
modern economic goal; a better distribution of income in the economy. For, this
improvement in the distribution of income would be achieved essentially through voluntary
donations. In this process taxation is definitively assigned a secondary role.
There are further implications: a lower tax burden means an enhancement in the
consumers and producers surpluses and a diminution in the dead-weight cost of the tax.
Consequently, lower taxes would have a positive impact on aggregate production while at the

9
same time reducing costs. Prices to the consumers would come down and pave the way for
non-inflationary growth (Wanniski, 1975: 49-50; The Economist, September 20th, 1997: 20).
Moreover, the waqf definitely solves the problem of the under supply of public
goods, so often observed in conventional economies. This point needs to be elaborated. In
this context we must first of all note that the services offered by the waqfs constitute public
goods, the consumption of which is non-rivalrous and the provision thereof non-excludable.
As is well known, the standard economic theory envisages that since, as rational
individuals, consumers of public goods tend to free ride, they fail to contribute to the costs of
creating these goods. Consequently, where rational behaviour prevails, public goods would
be under produced in conventional economies (Bates, 1995: 30).
As far as the Islamic world is concerned, there is much evidence to the contrary, i.e.,
to the ubiquitousness of the public goods supplied by the waqfs. Therefore, it seems more
appropriate to talk about an excess supply of public goods rather than their scarcity. In an
Islamic economy this excess supply, not scarcity, may emerge as the basic problem. It should
be emphasised at this point that this observation is not confined to past history but is valid for
all times. Indeed, there is no justification for the assumption that modern Muslims would be
less interested in charity then their forefathers. Given the right conditions, modern Muslims
have demonstrated that they are just as keen as their forefathers to establish waqfs.1
All the social and economic contributions of the waqf system mentioned above, are
based upon the crucial assumption that the waqfs are managed by prudent and efficient
trustees. History, unfortunately, provides evidence that this was not often the case. Archives,
indeed, are full of documents indicating the corruption of waqf officials. In short, there is a
serious agency problem associated with the waqf system. This constitutes one of the greatest
challenges to modern Islamic economists interested in revitalising this system.
The waqf system contributed significantly to another major economic problem:
employment. The ratio of persons employed by the waqf system to those employed directly
by the state fluctuated in Turkey as follows: at the turn of the century 8.23%, in 1931
12.68%, and in the 1990s 0.76%. Consequently, the waqf system appears to have ceased
being a major source of employment in the Turkish Republic. Although these figures do not
include the 30,000 various self-employed retailers and small-scale producers using the waqf
premises and the tens of thousands of individuals employed by the new waqfs established
according to the secular Turkish Civil Law (Bilici, 1992 and 1993), it is clear that the overall
contribution of the waqf system to employment has fallen significantly. This is in sharp
contrast with the West where the non-profit sector, which includes trusts and foundations,
Western equivalents of waqfs, accounted for an average of 13% of the net new jobs added
between 1980 and 1990 in France, Germany and the United States. In the United States the
non-profit sector accounts for 6.9% of total employment (Salamon and Anheier, 1996: xviii).
The decline in the contribution of the waqf system to employment reflects the overall
decline of the system in Turkey prior to the 1967 Act. This decline was a direct outcome of a
deliberate state policy. To understand this dramatic phenomenon we must first of all analyse
the forces, which prompted the state to attack the waqf system.
It might be appropriate to start with a few questions:
a. Why does the state feel the need to centralise and even to destroy the
waqf system? This question assumes great importance if the waqfs are
to avoid the wrath of the state in the future.
b. Since even the state had to obey some rules, what were the legal premises behind the
states interference?
c. Was the process of centralization and the pursuant destruction linear or cyclical?

The latest evidence from Turkey concerning the dynamic expansion in the number of
newly established waqfs confirms this. For details see below.
1

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These questions move us from the realm of economics into that of history and for
that, we need to go to the very origins.
III. The Origins
It is well known that philanthropic endowments have a history considerably older
than Islam and it is also very likely that Islam may have been influenced by earlier
civilisations. Ancient Mesopotamia, Greece, Rome as well as the pre-Islamic Arabs certainly
knew of such endowments (Laum, 1914; Rockwell, 1909; Rostowzew; Othman, 1982;
Duncan-Jones, 1982). The extent to which Islamic waqfs were influenced by these ancient
institutions and the extent to which they were the product of the genius of Islam, is a question
that is still not resolved. Roman, Byzantine, but also Mesopotamian, Sasanid, Jewish and
Buddhist influences have been accepted as plausible (Kprl, 1942: 10-11; Coing, 1981:
272-274). Latest research is more decisive and points to the Sasanid law as the most likely
source (Arjomand, 1998: 110-111). Thus, we have a fairly clear situation: Muslims were
urged strongly to endow their assets in the service of mankind and they knew how to do it
from the earlier civilisations, which had dominated the region in which they had found
themselves (Crecelius, 1995: 249).
At this point the reader may be impressed by the ability of Islam to borrow from
other civilisations. This ability may well have originated with a tradition attributed to Prophet
Muhammad:
Abu Hurairah reported Allahs messenger as saying: A word of wisdom is the lost
property of a believer, he can take it wherever he finds it, because he is more entitled
to it. (al-Tirmidhi, 1992: 2687)
Although waqf is not specifically mentioned therein, the concept of wealth redistribution is strongly emphasised in the Quran (2:215, 264, 270, 280). Moreover, there is
definitive evidence that many great personalities of Islam had endowed their properties for
charitable purposes. A hadith narrated again by Abu Hurairah most probably accounts for the
origin of this institution in the world of Islam:
Abu Hurairah reported Allahs messenger as saying: When a man dies, all his acts
come to an end, but three: recurring charity, or knowledge (by which people benefit),
or a pious offspring, who prays for him (Muslim, 1992: bab3, hadith 14).
Although the classical sources have, traditionally, taken into consideration each one
of these good deeds, sawabs, separately, we prefer to combine them. For it will be argued
here that such a combination constitutes the very essence of the Islamic waqfs. Thus,
Muslims needed an institution that would enable them to perform all three of these good
deeds. The waqf fitted the criteria. It indeed, assures ongoing, recurring charity for many
years, even centuries, after the death of the founder; it can finance scholars whose lasting
works will benefit mankind for a long period and the sawabs, good deeds, that accrue to them
would be shared by the waqf s founder who had provided for their sustenance in the first
place. Finally the management of the waqf can be entrusted to the offspring of the founder so
that while, on the one hand, careful and loyal management is assured, on the other, the
offspring would pray for the deceased since, thanks to his waqf, he or she is not destitute.
Although Muslims may have been encouraged to borrow ideas from other
civilisations without any hesitation, as the aforementioned hadith suggests, the actual process
of borrowing was not simple. For, whatever institution was borrowed, it had to be moulded
and re-shaped to conform to the basic teachings of Islam. There were substantial differences
in the opinions of the early great jurists concerning the structure and judicial framework of
the waqf. While Imam Shafii had objections to certain aspects of the institution, among the

11
Hanafis, Imam Abu Yusuf differed from his mentors. Without going into details, it can be
argued, in general, that Imams Shafi`i and Abu Yusuf wanted to expand the waqfs and
therefore facilitated their foundation, but others preferred to restrict this institution.
The basic problem pertained to the Islamic law of inheritance: since a founder could
entrust the management of his waqf to any one of his offspring and thus initiate a de facto
primogeniture, this could violate the basic principles of Islamic law, which promulgates a
distribution of property among all the inheritors. Consequently, most of the jurists found it
very difficult to sanction the waqfs.
But for reasons that will be explained below, the Muslim society needed this
institution. So the great jurists ended up tolerating it. The turning point came when Abu
Yusuf observed how important these institutions had become during his pilgrimage and
introduced new legislature, which facilitated the establishment of foundations. The institution
of waqf thus emerged after the death of the Prophet and its legal structure was firmly
established during the second half of the second century (Kprl, 1942: 4).
At this point we need to explain how a system, which did not originate in Islam, not
specifically mentioned in the Quran and objected to initially by many of the eminent jurists,
was embraced so enthusiastically and developed to such a phenomenal dimension. There can
be two explanations, historical and economic. Let us first consider the former: the great
Islamic conquests had enriched the Muslim world beyond any imagination achieving the
economic preconditions for the emergence of this institution. We have to remember,
moreover, the emphasis attached in the prophetic traditions on the importance of doing good
and charitable deeds. Since wealth in Islam is considered an important source of trial, the
natural tendency among the Muslim rich to do good deeds as a preparation for the hereafter
can be easily understood. Thus, it is for these historical reasons that although not mentioned
in the Quran specifically, and objected to initially, the waqf has been embraced so
enthusiastically.
But this is not all; economic theory also has its own explanation of why the waqf
system was needed. Indeed, according to the theory there were compelling reasons for the
waqf system to emerge. We have seen above that under the conditions of rational behaviour,
public goods would tend to be under produced. This dilemma pertaining to the creation of
public goods promotes a demand for the creation of non-market institutions.
This demand for the creation of non-market institutions may also explain why the
waqf became so popular and widespread in most of the Muslim world. The theory explains,
furthermore, the universality of the waqfs or waqf-like non-market institutions. After all, as
briefly mentioned above, endowments are known not only in the Muslim world but also in
the West and other great civilisations (Salamon and Anheier, 1997; Geremek 1994; Coing,
1981, Crecelius, 1995). In the remainder of this chapter, evidence for this argument
pertaining to three cases: England, Spain and South Africa, will be provided

IV. Impact on Others

Having lost all contact with Rome, Medieval Europe had to become acquainted with
philanthropic endowments through the Islamic waqf system. This is attested to by Monica
Gaudiosi, who has initiated an inquiry regarding the origins of English trusts (Gaudiosi,
1988). Gaudiosi first puts to test the conventional wisdom prevailing among the European
scholarship that the origin of the English trust rests with the Roman or Germanic laws. She
challenges this view by arguing that the trusts developed from a medieval English device for
holding land known as the use.
Furthermore, considering the Roman fideicommissum first, she reminds us that the
linkage between this institution and the English trusts had already been dismissed by the
nineteenth century on the grounds that not only were the similarities between the two
institutions merely superficial, but also, whereas the Roman device was purely testamentary,
the early English use seldom arose by will.

12
Next she challenges the notion that the origin of the English trusts can be traced back
to Lex Salica, the legal code of the Salian Franks, a German tribe. In this rejection, Cattan
also supports her. This is then followed by a vigorous argument about why Islamic waqfs
constitute the origin of the English trusts. The basic points of this argument are as follows:
a. Whereas, the separation of ownership from usufruct was not a new legal
concept, the settlement of the usufruct of the endowed property on successive generations in
perpetuity for a charitable purpose was an institution, which was created by the classical
Muslim jurists of the first three centuries of Islam. There is no evidence that such a complex
system of appropriating the usufruct to varying and successive beneficiaries existed prior to
Islam (Cattan, 1955: 205).
b. The emergence of the trust coincides with a period of increased contact between Europe
and the Muslim world. Indeed, the Franciscan Friars who are believed to have introduced
the use in England were active in the Middle East. Saint Francis, himself, spent the years
1219 and 1220 in Islamic territory.
c. Jerusalem was a particularly significant point of contact between England and the Muslim
world because of the presence there of the Orders of the Templars or the Hospitalers.
Since it is well known that these orders had been influential in the development of the
Inns of Court in fourteenth century England, the transmission of legal institutions from the
Islamic world to England has already been demonstrated. Recent research has, moreover,
shown that the transmission of legal institutions did not remain limited to the Inns of
Court, and that the bulk of the partnership law was also borrowed from the Muslims
(izaka, 1996). Consequently, all the conditions necessary for the transfer of waqfs, i.e.,
contact, detailed knowledge about the way the institution to be borrowed functions, etc.,
already existed.
d. More importantly, similarity between Islamic waqfs and English trusts, is striking. Under
both systems, property is reserved and the usufruct is appropriated for the benefits of
specific individuals or for a general charitable purpose. The corpus becomes inalienable;
estates for life in favour of successive beneficiaries can be created at the will of a founder
without regard to the law of inheritance or the rights of the heirs and continuity is secured
by successive appointments of trustees.
e. It has been argued that a major difference between the two
systems exists:
whereas in the English case, the trustee is considered to be the owner of the trust, in the
Islamic waqf the trustee (mutawalli) is not considered to be the owner. In reality, the
trustee is no more the owner of a trust than the mutawalli could be the owner of a waqf.
The main function of both is to administer the property for the benefit not of themselves
but for the beneficiaries as specified by the trust or waqf.
f. Another alleged difference pertains to the duration: the waqf
must be perpetual,
while a trust, except a charitable one, cannot be perpetual. It must be remembered,
however, that in England the trusts could originally be made in perpetuity until the rule
against perpetuities came into force.
g. It has been argued, however, that there is one very important difference: purpose of the
waqf or trust. A trust may be made for any lawful objective, a waqf, by contrast, must be
charitable. Charitability is a conditio sine qua non for all waqfs including the family
endowments (Cattan, 1955: 212). But this difference much emphasised by Cattan, has
been watered down in reality. Ottoman documents indicate there were many waqfs
endowed for a wide range of purposes some of which can hardly be considered as strictly
charitable.
While all of the above provide substantial and convincing evidence for the argument
that Islamic waqfs constituted the origins of the English trusts, some subtle ritualistic
differences between the two systems are also acknowledged. These ritualistic differences
have already been very adequately explained in Jones (1980) and Hodgson (1968).

13
While it is important to appreciate the ritualistic differences between the Christian
and Muslim endowments, the reader should not go to the other extreme and dismiss the
arguments made by Gaudiosi and Cattan. The evidence presented by these two authors that
the Islamic waqf system has constituted the origins of the English trusts, is substantial and
convincing. It is appropriate to include here an analysis of the 1264 Statutes of Merton
College, Oxford, provided by Gaudiosi, which is further evidence.
Walter de Merton, the founder of the Merton College, Oxford, was a thirteenth
century English clergyman and government servant who three times held the powerful
position of the Chancellor of England. It is well known that de Merton was closely associated
with the New Temple which was the English headquarters of the Knights Templars who had
significant contact with the Middle East and particularly with Jerusalem. During de Mertons
final term in office, he wielded unusual power, being described as practically the regent of
the Kingdom, while Edward I was on crusade in the Holy Land. Surely, his position of
authority would have involved him in relations between the Middle East and England
particularly during the Crusades.
De Mertons college went through a number of stages before it attained its status as
a watershed in the history of colleges (Makdisi, 1984). Concerned with the provision of a
university education for his nephews, de Merton in 1262 obtained a license to vest certain
properties for the support of university students. Two years later, the final form of the 1264
Statutes of Merton College was registered.
In the opening sentences of the statutes, de Merton set forth a charitable purpose for
his trust and properties for the support of that objective. As is well known, this procedure is a
conditio sine qua non for any classical Islamic waqf. The first condition of the trust was that
any member of the founders family must be supported by the trust in return for appropriate
service. Again, this is another provision sanctioned by Islamic law. Given that the focus of de
Mertons foundation was the establishment of a college, it would correspond to the charitable
waqf, waqf khayri. The designation of certain family members as beneficiaries, moreover,
would certainly conform to the traditions of the Prophet of Islam.
Gaudiosi provides a host of further evidence from sumptuary regulations to the
provisions allowing the beneficiaries to appoint an overseer to examine the accounts of the
trustee and observes that
the structure of Merton College fulfils a number of conditions necessary for the
establishment of an Islamic waqf and does not violate any of the stipulations of the Islamic
waqf law.
Her conclusion is striking:
Were the Merton documents written in Arabic rather than Latin, the statutes could surely be
accepted as a waqf instrument.
In view of everything said above, we reach the conclusion that the origin of the
English trusts can almost certainly be traced back to the Islamic waqf system. It is also telling
that in the mid-thirteenth century two other colleges of Oxford were also founded as
charitable trusts (Arjomand, 1998: 115).
If, however, far away England had, indeed, been affected to such a degree by the
waqfs, it is reasonable to argue that the Christian Mediterranean, much nearer to the Islamic
world, would certainly have been affected as well. This is confirmed by Gilbert who has
shown that Collge des Dix-Huit established in Paris by one John of London in 1180 was
strongly influenced by the waqf madrasas he had seen in Jerusalem (Arjomand, 1988: 114115). Other evidence is provided by Santiago De Los Espanoles, a foundation established by
the Crown of Castile in Rome for the welfare of the Spanish pilgrims, appears to have had an
identical organisational structure to an Islamic waqf. There appears to have been only one

14
major difference between these two institutions: whereas the Spanish foundation regularly
purchased with its annual profits interest yielding public bonds, lugares de monte, an Islamic
waqf typically would reinvest its profits to expand its capital (Gozalo, 1998). This difference,
obviously, must have been due to the stringent prohibition of interest in the Islamic world.
Having such common origins, the two institutions are naturally quite similar in basic
structure. Some eight centuries later, this similarity is still reflected in everyday practice and,
under special circumstances, has been effectively utilised by Muslim minorities. This is the
case of the Muslims living in predominantly Christian cultures where a law of waqfs does not
exist. Consider the case of South Africa where Muslims have established their waqfs under
the South African Law of Trusts. The hundreds of mosques and madrasahs built all over
South Africa are all managed under this law which is the closest approximation to an Islamic
waqf law. The AMAL (Association of Accountants and Lawyers for Islamic law) has
identified the following similarities and differences between the South African Trusts and
Islamic waqfs: 2
WAQF
Generally charitable and has religious motive
Founder may be the beneficiary (only under
Hanafi law).
Ultimate objective must be the benefit of
mankind.
Property vests in Allah
Mutawalli only a manager
Perpetual, cannot be terminated under any
circumstances
Irrevocable
Corpus is immobilised
Usufruct is used for the benefit of mankind

TRUST
No religious motive needed
Founder may be the beneficiary
Any lawful objective will do
Property vests in the trustee
Trustee has larger power
Need not be permanent. Can be terminated as
stipulated in the trust deed.
Revocable
Corpus is immobilised
Usufruct is used for the objective stated in
the deed

AMALs comparison gives us the impression that the trust appears to have evolved
into a more flexible structure than the waqf. But this argument should be considered with
caution, for we are of the opinion that the Islamic waqf has also evolved in the same direction
and therefore the differences stated by AMAL have been exaggerated. Supportive evidence
will be presented below.

Proceedings of the Seminar on Management and Development of Awqaf Properties,

4-16 August 1984 (Jeddah: Islamic Research and Training Institute, 1987), p. 112.
2

15

CHAPTER TWO: FUNCTIONING OF THE SYSTEM AND JUDICIAL PROBLEMS

CHAPTER TWO: FUNCTIONING OF THE SYSTEM AND JUDICIAL PROBLEMS

In a nutshell, a waqf functions as follows: a founder who has accumulated private
wealth decides to endow his personal property for a specific, often, pious, purpose. The
amount of the original capital, corpus, the purpose for which it is endowed and all the other
conditions of management are clearly registered in a deed of endowment, submitted to the
authorities. In this way the privately accumulated wealth of a pious Muslim becomes Gods
property. The founder strictly stipulates how the annual revenue of the waqf should be spent.
This revenue (usufruct) may be allocated completely for a pious purpose (waqf khayri), or to
a group of beneficiaries. The offspring of the founder may also be the primary recipients of
this annual revenue. Such waqfs are known as the family waqfs or waqf ahli. The

17
management of the waqf is entrusted to a trustee, mutawalli, whose functions may be fulfilled
by the founder himself during his lifetime. Thus, there are four major components of any
waqf: the founder, the beneficiaries, the trustees and the endowed capital corpus itself. We
will now consider each one of these components in detail.

I.

The Founders

It is appropriate to start this section with an analysis of the founders. Research based
upon more than 300 waqfs of fifteenth and sixteenth century Edirne, a frontier town in the
Ottoman Balkans, has revealed that the vast majority of the Ottoman waqfs were founded by
private individuals rather than the sultans whose waqfs constituted a mere 1 to 2% of the total
(Gerber, 1983: 29). The overall number of founders, with the exception of the sultanic and
those founded by women, was 233. Of these founders 43% (100) were ordinary citizens and
57% (133) were members of the elite. In order to compare the sizes, privately endowed waqfs
were categorised into three groups according to the endowment capital: small, medium, and
large waqfs. There were 216 waqfs, which could be classified according to size (including the
sultanic and womens waqfs). Of these 30% belonged to the smallest category; 70% were
middle sized; and only 1% was large.
As for the connection between the founders and the size, ordinary citizens generally
founded small waqfs - 62% of their endowments were small and 48% medium. In contrast,
members of the elite generally established medium sized waqfs (5% small, 93% medium and
2% large). Women established only 20% of the waqfs in Edirne.
In Istanbul and Aleppo, by contrast, the equivalent percentage was at least 40%.
Gerber has attempted to account for this discrepancy with the argument that Edirne was a
frontier town and consequently it must have had a relatively smaller and passive female
population.
Thus Gerber has reached a very clear conclusion: ordinary citizens tended to
establish small and medium sized waqfs, while the elite founded larger ones. The vast
majority were established by ordinary citizens. Unfortunately, similar statistics do not exist
for other Islamic countries but it is reasonable to assume that the situation should be similar
elsewhere.
1. The Ten Conditions
At this point it is appropriate to identify the powers, which the founders reserve for
themselves during the establishment of their waqfs. Put differently, when endowing their
properties and transferring the ownership from their own possession to that of God, the
founders had to follow a strict procedure but they were permitted to retain certain powers.
These powers are to be found in almost all the endowment deeds and have been called the ten
conditions by the late Hanafi jurists. They are traditionally expressed as five twin conditions,
which negate each other:

a.

b.

c.

Expand-Reduce (teksr-takll): The founder can expand the share of a beneficiary from the
usufruct of the endowment, or can reduce it. Normally, the founder would be allowed to
make such changes only once, unless he has stipulated in the endowment deed that he
wishes to enjoy the right to expand or reduce for as long as he lives.
Enter-Exit (idhal-ihrac): The founder is empowered to make a person beneficiary even if
he would not be considered one under normal circumstances (idhal). Conversely, the
founder also has the power to deprive a beneficiary of his normal privilege. The Hanafis
consider the idhal-ihrac as the absolute prerogative of the founder, while the Shafiis and
the Hanbalis are of the opinion that this is not an absolute but a limited one.
Pay-Freeze (It-Hirman): The founder may assign priority to the regular and
uninterrupted payment of one beneficiary (it) and conversely, postpone the payment to
others (hirman). This flexibility, which is granted not only to the founder but also to the

18

d.

e.

trustee, allows a waqf to manage its budget according to a list of priorities determined by
its founder. The condition assumes particular importance for those waqfs, which have a
multitude of beneficiaries.
Changing Conditions-Purpose (ta yir-tebdil): The founder enjoys the right to change the
conditions stipulated in the waqf deed (ta yir). He or she also retains the power to change
the original purpose of the waqf, like converting a charitable waqf into a family waqf or
vice versa.3
Sell- Exchange (ibdal- stibdal): The founder may permit himself to sell the corpus of the
waqf for cash (ibdal), or exchange it for another property (istibdal). In historical
documents, istibdal, is more often used and usually pertains to both sale and exchange of
the corpus.

This is an important power that the founder can bestow upon himself. The
importance of istibdal lies in the fact that it embodies certain dynamism. By allowing the
founder to sell the waqf property the system is made responsive to market conditions. Thus, if
a waqf land which happens to be originally at the outskirts of a town ends up being in the
middle of it due to urban expansion and its value skyrockets as a result, the founder is
enabled to exchange the waqf land for another one, and in the process, can either expand the
waqf land, again, at the outskirts by purchasing much more land or enrich his waqf with cash.
Furthermore, istibdal assumes great importance particularly for those waqfs whose
corpus is constituted of movables. Such waqfs achieve perpetuity, a conditio sine qua non,
often by applying istibdal. Indeed, if we consider a cash waqf i.e., where the original
endowment was in cash, and assume further that the government is planning to change the
currency of the country or debase it, istibdal under such conditions, becomes a vitally
important instrument to assure the perpetuity of the waqf.
It goes without saying that while certain dynamism is indeed embodied in istibdal,
this rule also embodies great potential for misuse. So much so that this instrument essential
for the survival of the institution of waqfs has been used by its opponents to destroy it
(Akgndz, 1988: 291). The details of this phenomenon will be presented below. Meanwhile,
we may note that wherever applied, this instrument has fuelled passions. This is
understandable, for istibdal allows the sale of a waqf property, which is supposed to belong
to God and be perpetual. Behrens-Abouseif has even argued that the Ottoman occupation of
Egypt was prompted by an illegal istibdal procedure, which attempted to sell the Al-Azhar
complex (1994: 146-147).
This brings us to the question of under what conditions istibdal would be legal. The
answer is complicated by the fact that the four major schools of Sunni Islam do not agree on
this problem. The Malikis, for instance, strictly prohibit istibdal in real estate waqfs with very
few exceptions. But the Malikis are considerably less strict concerning the istibdal of the
waqf of movables. The only condition they attach to such istibdal is that the movable corpus
of the waqf should have been reduced to such a state that it has become impossible to fulfil
the original purpose of the waqf because it is not generating sufficient returns.

A real case from Ottoman Egypt may illustrate the point: Iskender Pasha who
governed Egypt from 1556 to 1559 had a foundation which was a religious complex.
Whatever remained of the waqf revenues after the obligations of the endowment were
fulfilled reverted to the founder during his lifetime. After his death, 2/3 of the surplus
revenues were to be added to the foundation, and 1/3 would go to the founders heirs
or, if he had none, to the foundation.This stipulation was later changed to give the
heirs 2/3 instead of 1/3, thereby decreasing the charitable portion of the waqf
(Behrens-Abouseif, 1994: 195).
3

19
The Shafiis are also against istibdal, which in their opinion can be used as an
instrument to destroy waqf properties. They even prohibit the sale of a totally destroyed
mosque on the grounds that it may be restored some day. Thus, the Shafii position is even
more stringent than that of the Malikis. In view of this, Behrens-Abouseifs above-mentioned
argument that the attempted sale of the Al-Azhar had prompted the Ottoman Sultan to occupy
Egypt, which in his opinion had become totally corrupt, can be understood better. For, Shafii
law was the prevailing law in pre-Ottoman Egypt and selling any waqf property, let alone the
famous Al-Azhar, should have been strictly prohibited.
The irony of all this was that the Ottoman Sultan belonged to the Hanafi School,
which had the most liberal perspective on istibdal. The Hanafi position on istibdal has been
summarised as follows: if the founder of the waqf has not made any stipulation in the deed
about the sale or exchange of the waqfs property, then an istibdal transaction would not be
permitted. But if the waqfs property is in such a poor state that it does not generate any
revenue or the revenue that it generates is not sufficient to cover its expenses and therefore an
istibdal of waqf property is deemed to be beneficial for the waqf, then under such
circumstances, even if the founder has not stipulated istibdal in the deed of endowment, such
a transaction may be permitted subject to the approval of the judge as well as the permission
of the Sultan. This latter condition prohibiting istibdal unless permitted by a sultanic decree,
irade-i seniye, was promulgated in the year 951 A.H. by the Ottoman eyhlislam Ebussuud
Efendi (mer Hilmi, 1307A.H.: 198).
Yet, even the Hanafi position was controversial. According to this school there can
be three alternatives pertaining to istibdal:

a.

b.

c.

d.

When the founder has permitted himself, according to the ten conditions mentioned
above, to resort to istibdal. Under this condition three conflicting opinions have been
voiced:
i. Imam Muhammad (al-Shaybani) has rejected this condition and argued that while the
waqf would be valid, the condition itself would be void. Put differently, according to
Imam Muhammad, the founder cannot vest himself with such an authority.
ii. A group of Hanafi jurists have argued that if a founder reserves for himself the right
to apply istibdal, both the waqf and the condition would be void.
iii. Led by Abu Yusuf, the majority of the Hanafi School considers such a waqf as well
as the tenth condition of ibdal-istibdal as valid.
When the waqf properties are ruined to the extent that they have become totally useless,
i.e., generating no revenue or not enough to cover its expenses. Under such conditions,
even if the original founder had not vested himself with the authority to resort to istibdal,
and providing that the local judge decides that an istibdal would be beneficial to the waqf,
the great majority of the Hanafi jurists, including Imam Muhammad, have approved of
istibdal.
When the founder has not vested himself with the right to resort to istibdal and when the
waqf properties are still usable, but it is argued that if the waqf property were subjected to
istibdal, it would generate greater revenue for the waqf.
i. A group of jurists, led by Hill, have argued that this may lead to corruption and
should therefore be prohibited.
ii. Led by Abu Yusuf, another group is of the opinion that, providing the judges
permission is obtained, istibdal would be valid.
Finally, when the founder has ruled that istibdal is void. Under this situation two
conflicting opinions have been propounded:
i. In such a situation neither the judge nor any other person can resort to istibdal.

20

ii. Led by Abu Yusuf, another group of jurists have argued that if the judge considers it

beneficial to the waqf, he can override the original conditions stipulated by the
founder.

Thus, in short, istibdal is a highly controversial issue in Islamic law and has been
likened to a sharp knife capable of cutting both for good and for evil (Akgndz, 1988: 296).
The latter, however, has been challenged by recent research. In a fascinating article Miriam
Hoexter has argued that the alleged direct linkage between istibdal and corruption should not
be taken for granted. On the contrary, she has furnished solid evidence from the Algerian
waqf registers that istibdal transactions were not only economically fair but also constituted a
very profitable business for the Algerian Harameyn waqfs (Hoexter, 1997).

II. Beneficiaries and the Family Waqf Controversy

It is well known that the waqf system provided regular salaries to many beneficiaries.
Recently, these beneficiaries who were paid from the annual revenues of the awqaf have been
categorised into various groups: administration, education, food for the public, family of the
founders, maintenance, religion, municipal services, tax relief, etc. (izaka, 1995: 339).
Since a detailed analysis of these groups has already been made, we will not repeat it here. It
should suffice to note that a long-term analysis of the relative amount each group obtained
from the waqf system in any given city would reveal important insight into the prevailing
value system of that city and its evolution (izaka, 1994).
At this point it is important to remember that waqfs allocated their annual revenues to
a myriad of beneficiaries, a founder could also appoint himself or his inheritors as the
primary beneficiary. This type is known as the ehli vakf, or the family waqf. The revenue of
such waqfs are reserved for the benefit of the founder or the offspring. Initially public benefit
is of secondary importance; it assumes primary importance only after the nesil expires, i.e.,
when there are no more descendants of the founder and so the entire revenue of the waqf
accrues to public purposes. Through such waqfs it was also possible to avoid Islamic
inheritance rules and to bequeath to a specific member of the family. In short, though not
sanctioned by Islamic law, primogeniture could be applied in the Islamic world by resorting
to family waqfs. This possibility had, naturally, far reaching consequences throughout the
world of Islam, to which reference will be made later.
The origins of this specific type of waqf are obscure and controversial. French
orientalists, for instance, have argued that the family waqfs originated in the reaction of the
Arabs to the Islamic law of inheritance, which aimed at improving the position of women in
the society. But when women were made eligible to inherit, this offended the local traditions
and the Arabs tried to find an indirect way to circumvent the new law and still apply a sort of
primogeniture or at least to bequeath only to the male offspring. These orientalists thus
argued that whereas the origins of waqf were undoubtedly Islamic, in the later centuries they
evolved primarily to circumvent the law of inheritance.
This line of reasoning ignores the Prophetic traditions fully sanctioning pious
offerings for provisioning the self, the children and the needy relatives (Qureshi, 1990: 82).
Thus, the whole argument that the family waqfs were a relatively late development is false. It
is well known, moreover, that when Omar, the Second Caliph, endowed his land in Khaibar,
he allocated its usufruct, among other things, to his offspring following the Prophets advice,
and that Imam Shafii, himself, had also endowed his house in Fustat to his offspring.
Moreover, it is also well known that the great Hanafite jurists were involved in a bitter
controversy over the legality of family waqfs, which casts further doubt on the orientalist
argument that this institution was a later Arab invention. The controversy was between Imam
Abu Yusuf on the one hand and Imam Hanafi and Muhammad (Shaybani) on the other, in
short, a conflict among the giants of Islamic (Hanafite) jurisprudence.

21
It is therefore all the more remarkable that Abu Yusufs complicated and
controversial position came to be accepted not only by the Hanafite regions of Islam but even
by some other regions where Hanafite law was not dominant (such as Algiers). The
permission granted by Abu Yusuf to the family waqfs was well accepted by the Islamic world
in general and assumed a definitive character particularly in the Hanafite regions. But the
controversy did not wane and resurfaced time and again. The seventeenth century Ottoman
controversy triggered by the great statesman Koi Bey was based on the following
observation: the conversion of state lands into personal property and then into waqf. Thus the
lands, which were originally assigned for the military fief (tmar), were being increasingly reallocated for religious/non-military usage through the waqf system. This problem was not
apparently so serious in Mughal India, for the Mughals, according to Kozlowski, were cash
rich: all the Mughal land tax came to the treasury as cash. So the emperors made cash grants
to those they wished to patronise rather than alienating state lands to them (Crecelius, 1995:
259). But it assumed serious proportions in the Ottoman Empire and led to bitter complaints.
Finally, 200 years later in French North Africa and British India, the controversy resurfaced
again, this time, by the colonialists and orientalists who challenged the legitimacy of family
waqfs for their own ends.
Most orientalists have argued that family waqfs were also resorted to in order to
protect the family property from arbitrary confiscations of the rulers. This was apparently
another reason why this institution had become so popular. Kprl accepts this explanation
as plausible but argues that this motive cannot explain all the waqfs. Consider, for instance,
the palace eunuchs who had no offspring but who established substantial foundations
(Kprl, 1942: 5-6). The strongest refutation to the confiscation argument has been
provided, however, by Gerber who demonstrated that the women of Edirne, who had nothing
to fear from confiscations, established 65% of the waqfs they endowed as family waqfs,
while 80% of the waqfs endowed by those who had the most to fear, the elite, were
charitable. Thus Gerber concludes:
In fifteenth and sixteenth centuries Edirne, the waqf was used only
in a minor capacity or even rarely in order to safeguard the property
of the founders for transmission purposes (1983: 35).
In any case, family waqfs, in general, did not constitute the majority of the waqfs in
the Ottoman Empire: Barkan has shown that the ratio of family/charitable waqf ratio was not
particularly high during the sixteenth century while a recent analysis has revealed that during
the eighteenth century merely 14.20% of the total awqaf revenue and during the nineteenth,
16.87%, was reserved for the family members of the founders. In Aleppo the ratio was
somewhat larger: of the total of 687 waqfs established in this city between 1718 and 1800,
50.7% were charitable, 39.3% were family and 10% were mixed (ztrk, 1995: 249;
Masters, 1988: 173).
Another motive in establishing family waqfs, it has been argued, was to protect the
property of an indebted person. In the Ottoman lands this practice was prohibited by a fatwa
of Ebussuud during the sixteenth century while in India it led to a huge controversy
beginning in 1894 with the Abdul Fata (and others) v. Russomoy (and others) case in the
Privy Council and culminating in Muhammad Ali Jinnahs victory and the passing of the
Mussalman Waqf Validating Act of 1913.
Meanwhile the popularity in Egypt of the family waqfs has been demonstrated by the
fact that these awqaf yielded more revenue in 1928-29 than all the other types. This situation
was one of the reasons, which eventually led to the total prohibition of these waqfs in Egypt
later.
III. The Trustees (mutawallis)

22
Islamic law considers trustees strictly as managers to whom the waqf is entrusted.
While these individuals were the ones who actually preserved the magnificent Islamic
heritage through the centuries and enabled many waqfs to survive for centuries, it was also
they who ended up being accused ruthlessly and held responsible for the demise of the
system. It can be argued that all the major changes in the administration of the waqf system
throughout history were undertaken in order to put these trustees under stricter control and
end their opportunities for misuse and embezzlement. Sometimes accusations against them
were justified, after all the trustees were only humans, but sometimes they were simply used
as scapegoats and served the more sinister schemes of the state. The details of how the
trustees fared as individuals crucial for the survival of the waqf system and as culprits, will
be presented below.

IV. The Original Capital of the Endowment (corpus)

The conditio sine qua non of any waqf is that it should be established with privately
owned capital. Behind this simple statement, however, there are bitter debates and
controversies. Consider, for instance, land as the corpus. Was land a privately owned
commodity under Islamic law, and had the corpus to be restricted to land and other real
estate? There are two huge controversies contained within this simple question. The one
pertaining to the private ownership of land, led to an enormously complex relationship: the
state vis- a- vis the waqfs. The other one pertaining to the type of the corpus, i.e., movables
versus immovables, led to the cash waqf controversy. The latter will be dealt with first.

CHAPTER THREE: CASH WAQFS IN THE ISLAMIC WORLD

CHAPTER THREE: CASH WAQFS IN THE ISLAMIC WORLD

I. Legal Issues
1. Introduction
The cash waqf was a special type of endowment which differed from the ordinary
real estate waqf in that its original capital, asl al-mal or, corpus, consisted purely or partially,

24
of cash. The earliest origins of the cash waqfs in the Islamic world,4 may be traced back to
the eighth century, when Imam Zufer was asked how such waqfs should function. The fact
that the question was asked at all, may be taken as an indication of the existence of such
waqfs at that time. Be that as it may, these endowments had been approved by the Ottoman
courts as early as the fifteenth century and by the end of the sixteenth they had become the
dominant form of waqf all over Anatolia and the Balkans (izaka, 1995; Sucesk, 1966).
It has been argued that cash waqfs were legalised only in the Turkish speaking parts
of the Ottoman Empire, i.e., Anatolia and the Balkans and that the more pious Arabs never
allowed these waqfs in the Arab provinces (Mandaville, 1979). While this view may have
had some legitimacy in history, it is no longer acceptable, for later research has revealed that
cash waqfs exist in Syria, Egypt, Sudan and Aden.5 In Egypt, waqf of movables has been
permitted by the law number 48, dated 1946. Moreover, the diffusion of cash waqfs is far
more extensive than once presumed: they have been observed in the Ural-Volga region; in
India and Pakistan they are considered to be legal since 1913; in Iraq, as we will see below,
there is a fatwa issued by the celebrated Mujtahid of Karbala, permitting them; in the Islamic
Republic of Iran the famous waqf Astan-e Qods-e Razawi has recently purchased shares in
various industrial complexes thus establishing cash waqfs, again in Iran, they have been
permitted by the May 17, 1986 Cabinet Decree, Article no. 44; and finally they have been
observed in the Malay world and in Singapore.6
The legality of the cash waqfs in the vast lands from the Balkans to the Malay world
thus implies a general acceptance by all the major schools of Islamic jurisprudence. But this
general acceptance has not been without a fierce controversy that lasted at least from the
sixteenth century until the twentieth.
2. The Hanafi Position on the Waqf of Movables (Cash Waqfs)
Probably the most detailed account of this controversy has been studied by
Suhrawardy, an Indian jurist-scholar who travelled to the Ottoman lands at the height of
another controversy, that of the family waqfs, prevailing in India. His major Article on the
legality of cash waqfs (Suhrawardy, 1911) was published just two years before the family
waqf controversy ended in the victory of Muslims against the British establishment. Thus the
first two decades of the present century was one of fierce legal debate about the waqfs

For perpetual cash foundations in Roman empire see; Duncan-Jones (1982: 133138).
5
For Syrian cash waqfs (sixteenth-seventeenth centuries) see; Bruce Masters, The
Origins of Western Economic Dominance in the Middle East (New York: New York
University Press, 1988), p. 162; for Egyptian (modern), see the two fatwas given by
the muftis of Egypt and of Alexandria in 1908 presented below; see also G. Baer,
Studies in the Social History of Modern Egypt (Chicago: UCP, 1969), p. 80, as well as
A History of Land Ownership in Modern Egypt (London: Oxford University Press,
1962), p. 153 and Syed Ameer, Muhammadan Law (New Delhi: 1985), fourth edition,
p. 249. For the Sudan (also modern) see; Sumaiya Sid Ahmed Abdel Hadi, The Waqf
Institution in Sudan (Kuala Lumpur: ISTAC, Unpublished Research Paper, 1997), pp.
10, 20; for the indirect evidence for Aden see; J. N. D. Anderson, Islamic law in
Africa (London: Frank Cass, 1978, second edition), p. 37, footnote no.5.m. For
Malaysia and Singapore see; Moshe Yegar, Islam and Islamic Institutions in British
Malaya (Jerusalem/ al-Quds: The Magnes Press, 1979), pp. 207, 209.
6
Majlis Ugama Islam Singapura, Annual Report 1995, pp. 54-55. In Singapore cash
waqfs status is ambigious and transitionary. For details see below the section: Cash
Waqfs in Malaysia and Singapore.
4

25
(family as well as cash) in India and we should view Suhrawardys work from this
perspective.
The reason Suhrawardy travelled all the way to Istanbul is explained by himself in
the acknowledgements as follows:
I take this opportunity of expressing my sincere thanks to Muhammad Ali evki
Bey, and to Zaimzade Hasan Fehmi Bey, grandson and First Secretary to Field
Marshall Ghazi Ahmet Muhtar Pasha, late Ottoman High Commissioner in Egypt, for
obtaining access for me to several important libraries in the Ottoman Empire and also
for procuring for me the fatwas of the Grand Mufti of Egypt and of the Mufti of
Alexandria . In a subsequent issue of this journal I hope to give a translation of the
well-known treatise on the subject of this paper by the celebrated Sheikh al-Islam,
Mufti, Ebussuud, a manuscript copy of which I have just discovered in
Constantinople.
Thus, the purpose of his visit to the Ottoman lands was to study the cash waqf
controversy in the Ottoman Empire itself and to find out about the legality of this institution.
The manuscript of Ebussuud that he refers to was obviously the one written during the
sixteenth century at the height of the Ottoman cash waqf controversy (Mandaville, 1979). It
is noteworthy that he did not limit himself to the famous treatise but went so far as to obtain
fatwas from Egypt.
Actually, at the beginning of the twentieth century looking at the Ottoman Caliphate
and Egypt for solutions to the prevailing legal problems in India appears to have become the
established norm for Indian Muslims. For the family waqf controversy also the same method
was used. The implications of this situation should not escape us here. The Ottoman
Caliphate was the symbol of legitimacy in the Islamic world and any legal issue that was
solved in the Caliphate would be considered as solved in India as well. This was particularly
so as both regions followed the Hanafi law.7
Since the sixteenth century Ottoman legal debate concerning the validity of cash
waqfs has been well documented and summarised by Mandaville, we will concentrate here
on the controversy as it was reviewed by Suhrawardy at the beginning of this century.
Suhrawardy starts his work by a short statement, which reveals his overall purpose:
A careful perusal of this paper will, I venture to hope, leave no doubt in the
minds of the readers about the validity of the waqf of movables, including money,
shares in companies, securities, stocks etc.
This is followed by a useful account of the methodology of Islamic jurisprudence
with particular emphasis on the hierarchy of jurists and the reliability of sources. He then
acknowledges that divergence of opinion exists among the jurists and suggests that,
according to Prophetic tradition, this is a blessing.
Concerning the legality of cash waqfs, which he considers a special form of the waqf
of movables,8 the first source Suhrawardy consults is the Isaf of Burhan al-Din Ibrahim

Even in far away Malaysia, where the Shafii law prevails, the Ottoman codification
of Islamic Law, or the Mecelle, is presently used by the Islamic reformists who needed
categories of punishment more tolerant than the strict hudud (Horowitz, 1994: 243).
8
The question whether the cash waqfs were simply a special form of the waqf of
movables was fiercely debated during the sixteenth century. Both Imams Muhammad
(al-Shaybani) and Abu Yusuf permitted the waqf of movables, but they were silent
about cash waqfs. It was Abussuud, the Ottoman eyhlislam, who considered cash
7

26
written in 1499. Burhan al-din refers to Imam Muhammad (al-Shaybani) and argues that he
had permitted the endowment of movables subject to custom. Burhan el-din dismisses the
problem of the perpetuity of the endowments corpus based upon both custom and Prophetic
tradition, the latter referring to the well known cases of waqfs founded during the early days
of Islam with movables such as arms and horses.
Next, Suhrawardy has consulted Fatawa Kadi Khan where the great Hanafi jurist alSarakhsi is quoted. Al-Sarakhsi repeats Muhammads approval of the endowment of
movables.
Durr al Muntaqa where the true flexibility of Imam Muhammads permission is
referred to for the first time has provided a far more detailed analysis. This is the fact that the
permission to endow movables had been granted subject to custom as well as in the absence
of custom, i.e., that the permission was absolute. It was Abu Yusuf, who had permitted the
endowment of movables strictly subject to custom.
The next source consulted by Suhrawardy, Majma al-Anhur, repeats the approval of
Imam Muhammad and Abu Yusuf, but then takes a step further arguing that since a custom
regarding the endowment of cash had already surfaced at the time of Zufer, who was a
companion of the great Imam Abu Hanife, then these waqfs came within the purview of the
dictum of both Imam Muhammad as well as Abu Yusuf and therefore they must be allowed
without any doubt whatsoever. Thus,
fatwa of some to the effect that the view declaring the validity of the waqf of
dirhams is weak, because of its having been reported from Zufer, is incorrect9
Next we come to the controversy concerning the nature of custom, taamul. The
debate here is between the purists who argue that only custom prevailing at the time of the
Prophet and his companions should be considered, and the liberals arguing that custom of
all times must be considered as a source of jurisprudence. Majma al-Anhur rejects the purist
argument. Actually the rejection can be traced right back to the Prophet himself, who had
said as reported by Ahmad:
Whatever is good in the sight of the Muslims is good in the sight of God !
indicating that he trusted the judgement of Muslims as embodied in the established custom, at
all times. It is for this reason that custom is stronger than analogy, qiyas, as well as juristic
preference, istihsan and again, it is for this reason that Imam Abu Yusuf must have ruled the
waqf of movables valid subject to the existence of custom.

waqfs simply as a special form of the waqf of movables for the first time (Mandaville,
1979: 300-301).
9
The Mufti should give fatwa according to the dictum of the Imam absolutely, then
according to the dictum of the second, then of the third, then according to that of
Zufar and Hasan b. Ziyad. It is laid down in the chapter on the Bahr al-Raiq that when
there are two correct views regarding any particular question, it is lawful to give
judgement according to either of them, Suhrawardy, The Waqf of Movables,
op.cit., p. 326. Thus we are informed about the hierarchy among the great Imams of
the Hanafi school. Here, Imam refers to Abu Hanifah, himself, the second refers
to Abu Yusuf and the third to Muhammad al-Shaybani. But in Umdat al-Riayah, A
Commentary on the Sharh al-Wiqayah, (Lucknow), p. 16, Abu Yusuf and Muhammad
are given equal weight. This may well be because Muhammad al-Shaybani was
probably the very last student of Imam Hanifah attending his very last tutorials which
he held in prison.

27
The legal implications of a situation whereby custom appeared after Imam
Muhammads time and in a different country have been referred to in the Tahtawi. Reporting
that al-Nahr limits the validity of a waqf to the countries where it has been recognised,
Tahtawi rejects this argument based upon Ebussuud. He then provides the examples of
various movable waqfs which did not exist at the time of Imam Muhammad and for which
custom emerged afterwards. The most important example of such waqfs is the waqf of ships.
In our time practice has arisen with regard to the ships of the Red Sea. For some of
them are made waqf of for transporting grains destined for Mecca and Medina10 .
Thus the wisdom of Imam Muhammad in considering custom from a flexible
perspective is made crystal clear in Tahtawi. Muhammad held that the waqf of movables was
valid not only subject to the existence of custom at his time but also subject to custom which
may arise in another time and country. It is thanks to this flexibility that Islam gained two
very important types of waqf: the waqf of grain ships which made pilgrimage possible and
the cash waqfs. Suhrawardy finds the same point also emphasised in the Durr where it is
stated that law is based on the recognised practice of the age in question. The Durr considers
custom clearly as the basis of law in every clime and age.
The Kifayah looks at the problem from a different perspective and after weighing the
various methods of Islamic jurisprudence against each other reaches the conclusion that the
negation of the waqf of movables based on analogy, qiyas, should be rejected. The analogy
here pertains to the question of perpetuity, a primary condition of the validity of a waqf and
leads to the argument that since movables cannot endure, they violate the perpetuity
principle. Thus here we have two principles in conflict; analogy based on the problem of
perpetuity rejecting the cash waqfs and Prophetic tradition permitting the endowment of
movables in general, as well as custom permitting the specific form of movables. The
Kifayah concludes that the force of analogy as based on perpetuity is abandoned by reason of
custom as well as tradition. The latter pertains to a hadith to be found in al-Bukhari:
For verily did Khalid ibn al-Walid, make waqf of armour he had
in the way of Allah (Sahih Buhari: 2547).
while the former, i.e., the antagonistic influence of custom which has overruled analogy,
pertains to the ruling of Imam Muhammad explained above. In short, the argument that the
cash waqfs should be rejected because their corpus in the form of cash cannot be perpetual is
rejected on the grounds of custom and tradition, both are more powerful than the analogy
pertaining to perpetuity.
Next we come to the fierce debate between al-Ramli (d.1004 A.H.) and Radd alMukhtar. Al-Ramli tried to use the custom argument against the cash waqfs by arguing that
there were no cash waqfs at the time of Imam Muhammad and therefore no custom. But it
should be noted here that al-Ramli was not aware of al-Sarakhsis report that Imam
Muhammad had approved of the waqfs of movables even in the absence of custom.
Radd al-Mukhtar refutes and silences al-Ramli by arguing that cash has perpetuity,
because one dirham is as good as the other (Mandaville, 1979: 299). Moreover, we have here

Endowing ships appears to have originated with the Mamluks and it has been argued
that the Ottomans did not invent but took over this tradition. See, Doris BehrensAbouseif, Qaytbays Foundation in Medina.., Mamluk Studies Review, Volume II,
1998, p. 67. Hans Georg Majer rejects the idea of waqf ships altogether. He argues
that the term waqf ships referred to those ships bought by the waqfs. Ships were not
endowed as such and did not constitute the corpus of a waqf (Majers comment on my
paper Institutional Framework of Democratic Islam delivered at Munich University,
July 1998).
10

28
the order of the Sultan himself in favour of the cash waqfs. This order is of crucial
importance for Suhrawardy who argues that the Ottoman Sultans order is sufficient to
legalise such a waqf not only in his country but throughout the Muslim world. This is
because the order represents a given preference to one out of two views and this preference
removes the conflict and gives generality and concurrence to the view so preferred. Secondly,
the custom in Turkey cannot be called a practice in a particular country, but it is a general
and universal practice taamul alam and it is good enough to embrace the whole of the
Muslim world. Thirdly, if Turkey is a special country balad khas, within the meaning of
the rule of jurisprudence as laid down in the Sharh Manafi al-Daqqaq, still there being no
nass or tradition against the view of validity of any Islamic state, the view of the law in
Turkey is binding over all the Muslim world.
After providing us with these painstaking details of the debate on the validity of cash
waqfs, Suhrawardy asked the help of Ottoman Field-Marshall Ghazi Muhtar Pasha, former
governor of Egypt, for a fatwa from the Mufti of Egypt. Hasan Fehmi Bey, Secretary to Ghazi
Muhtar Pasha asked the following to the Mufti (Suhrawardy, 1911: 371):
What is your opinion concerning the following case? An Indian of the Hanafi sect
makes a waqf of government securities, stocks and bonds known amongst Europeans as rente
or of shares in trading companies, the practice of which has been recognised in our time in
certain countries. Will such a waqf be valid and permissible in India if it is recognised in
Turkey for instance ?
Answer (Written on 9 Muharrem 1326 A.H. (1908), fatwa no.167):
The subject of waqf must be property having legal value (mal al mutaqawwim)
provided it is land or movable property with regard to which there is custom. If the said
securities be property having legal value and there has been a practice of endowing them in
the country of the dedicator, their waqf would be valid according to Imam Muhammad, like
the waqf of dirhams and dinars the waqf of which is now recognised ...This opinion has been
adopted by the majority of jurists of various countries as stated in the Hidayah and this is the
correct opinion as stated in the Isaf and it is the dictum of most doctors as stated in the
Zahiriyyah. It is also laid down in Radd al-Mukhtar and it is expressly laid down in the
commentary on the Durr that the fatwa is in accordance with this. As to the waqf of
movables accessories to land, it is valid without any difference of opinion between Abu
Yusuf and Muhammad
Now, as to shares in trading companies, their waqf is of the nature of waqf of
musha. Now that you know that the waqf of movables is valid according to Muhammad you
should have also regard for the conditions laid down by him, e.g., that they should be divided
(not musha), when they are capable of division, and that they should be delivered to a
mutawalli even though they do not satisfy the condition of perpetuity, tabid. Finally you
should know that the language of the jurists here show some leaning towards taking special
recognised practice, urf khass, into consideration. This is one of the views of the school and
it is a proper view, since the language of the dedicators is based on their special practice, urf

Thus, the Mufti of Egypt has hesitated only on the question of whether the practice in
Turkey can be taken as binding for all Muslims. But his final words; you should know that
jurists here show some leaning towards taking special recognised practice, urf khass, into
consideration makes clear that custom in a Muslim country would be respected by the
others. To be on absolutely safe ground, Suhrawardy had Hasan Fehmi Bey ask the Mufti of
Alexandria the same question as well.
Answer (by Muhammad Bakhit al-Mutii, the Hanafi jurist of the University Mosque of alAzhar, Mufti of Alexandria):

29
These shares etc. are all included under the term movables and the pertinent rule is
as follows: .the waqf of movables as accessories to land is valid without any difference of
opinion between Abu Yusuf and Muhammad. If the waqf of such movables be made
independently (not as accessories to land) then Abu Yusuf rejects it, but Muhammad accepts
subject to taamul. This opinion has been adopted by the majority of jurists of various
countries as stated in the Hidayah, the Isaf, and in the Zahiriyya. Moreover, it has been
stated in the Mujtaba on the authority of the Siyar that according to Muhammad it is valid to
make a waqf of movables unrestrictedly and according to Abu Yusuf only when there is
taamul. Therefore, when a practice has arisen as to making waqf of these securities and
shares, their waqf is valid, especially as they are of the nature of coins, dirhams and dinars.
Now we find in the Manh: as a practice has arisen in our days in Turkey and other countries
of making waqf of dirhams and dinars, they come under the dictum of Muhammad in
accordance with which is the fatwa as regards movables in which there is taamul.
Since the taamul of the Muslims as regards to these things is based on the rule of
recognised practice urf, whereby analogy is disregarded on account of the saying of the
Prophet,
Whatever is good in the sight of Muslims is good in
the sight of Allah as reported by Ahmad.
That is why it is laid down in the Mabsut, What is established by usage, urf, is like what is
established by express text. And God knows best.
(Signed) Muhammad Bakhit al-Mutii.
Two points attract our attention in this fatwa; first, Bakhit al-Mutii
seems to have been aware of Imam Muhammads permission regarding the waqf of movables
whether there is established custom or not, hence his statement, according to Muhammad it
is valid to make a waqf of movables unrestrictedly and second, based upon Mabsut by alSarakhsi, one of the most respected sources in Islamic jurisprudence, he gives custom an
eminence approaching to that of the Quran and the sunnah.
We are now in a position to summarise the Hanafi position on the validity of the
waqfs of movables or their special form, the cash waqfs. The majority of the sources
presented above are in agreement that as far as the validity of these waqfs is concerned there
is no need to refer to Imam Zufer, who is considered to be a relatively weak source. The
whole issue can be traced back to the two companions of Abu Hanife; Imam Abu Yusuf
and Imam Muhammad al-Shaybani, both of whom are considered to be the greatest
authorities of the Hanafi Law. It is important that both have approved the waqf of movables.
The only point at which they differ is that whereas Abu Yusuf approves of them subject to
custom, Muhammads approval is subject to custom prevailing at his own time and country
and subject to custom that may emerge after his time and in any other land. This flexible
interpretation of Imam Muhammad is conveyed to us by another eminent jurist, Shams alAimmah al-Sarakhsi. Therefore, it is most reliable. It is for this reason that many sources
quoted above consider Imam Muhammads approval as unrestricted. At this point the
following rule applies: when of two conflicting opinions, one is more favourable to the waqf,
the mufti should deliver fatwa in accordance with that opinion. Consequently, Imam
Muhammads ruling applies and the Hanafi School declares the waqfs of movables, including
cash waqfs and the waqf of ships, valid. Finally, it should be added that the endowed cash
should be, preferably, invested through mudaraba, as Imam Zufer had suggested.
3. The Shafii Position:

30
The stance taken by the Shafii school on the waqf of movables is based upon Imam
Shafii ruling that the waqf of anything (italics are mine) is valid from which profit can be
derived whilst its original endures. What is important here is that the original capital of the
waqf, corpus, should not diminish due to consumption and should be renewable from time to
time by its usufruct. But the perpetuity of the waqf is not a condition sine qua non for the
Shafiis. Thus, the difficult debate witnessed among the Hanafis, as described above, does
not exist among the Shafiis.
It is said that the condition that the original capital should endure is to guard against
cash waqfs because it is not possible to benefit by them consistently.11 This negative view is
also supported by the Ghayat al-Bayan. But then Imam Shafiis position regarding custom
must be remembered. Imam Shafii, like Abu Yusuf, ultimately approves of the waqf of
movables subject to custom. Moreover, on the issue of custom he is almost as flexible as
Muhammad al-Shaybani, for he has introduced the concept of istishab. Istishab pertains to
the existence of a thing established by evidence. Even though later some doubt might arise as
to its continuance in existence, it is still considered to exist (Ibrahim, 1965: 69). Thus, a
practice once proved to be widespread may be presumed to be both ancient and continuing.
The relevance of istishab for cash waqfs is that their ancient existence during Imam Zufars
time, and their widespread and definitive existence in Ottoman lands between the fifteenth
and twentieth centuries render them valid for the Shafiis even today. It is not therefore
surprising that they are presently considered to be valid in certain Shafii lands, as has been
indicated at the beginning of this chapter.

4. The Maliki Position:

Imam Shafiis ruling that endowment of any moveable is valid subject to the
preservation and non-consummation of the corpus, has been accepted by the Malikis as well.
Furthermore, it is well known that Imam Malik had approved the waqfs of horses and arms
based on tradition. Two fatwas stated in the Mudawwana are even more directly related to
the question of cash waqfs. Two cases have been put to Malik, the first concerns a cash waqf
and the second, a simple donation. Malik has ruled that the annual return generated by the
cash waqf should be subject to the payment of zakah while he has exempted simple donation
from this obligation. The fact that he has not objected to the cash waqf, itself, but has merely
specified its relation to the zakah, i.e., his silence, indicates that he has approved of this
specific type of waqf. This has been confirmed in the Dardir, where it is stated:
As regards money, there is no hesitation whatsoever, it being absolutely valid to make waqf
of it as it is the express teaching of the mudawwana. By waqf here is meant waqf for the
purpose of lending out. The replacing of it by money of the same value is considered as
preservation of substance (Suhrawardy, 1911: 357).
It is important that the Dardir not only approves of cash endowments but also rules
that unless this endowed cash is invested by loaning out and earns a return, it would not be
valid as there would be no legal advantage in such a situation. Obviously, this condition
refers to the Shafiite position. In short, the Maliki position is clear: the endowment of
movables is approved.

5. The Hanbali Position:

Imam Ahmad ibn Hanbal has also accepted the Shafii condition that the endowment
of any moveable is valid providing that the corpus of the waqf is not consumed and
preserved.
11

(Suhrawardy, 1911: 342), based upon The Hidayah, vol.V, p. 430.

31

6. The Shiite Position:

The Shiite position regarding the cash waqfs is revealed by a fatwa given by Sheikh
Abd Allah al-Mazandarani, the Celebrated Mujtahid of Karbala in 1907. Question:
What does the great Hujjat al-Islam and the refuge of mankind, may his shadow extend, say
in connection with the religious point in law that, if several persons form a joint-stock
company and purchase a property at a fixed price and divide it into a number of shares of
equal value, for instance some purchase 10 shares and some 20 shares and so on, each having
a different number of shares, so that the annual profit may be divided proportionately
amongst the share holders according to the number of shares they hold. To explain this point
more clearly: hundred men purchased a bazaar, the total value of which is divided into 1,000
shares, of 100 rupees each, so that each share holder may receive the annual profit in
proportion to the number of shares he holds. For instance Zayd has got ten shares.
Whether Zayd can make a waqf of his own shares, so that the principal may remain as it is
and the income may be spent for a specific purpose. Whether such a waqf, according to the
Shiah Law is valid or not? It is hoped that your holiness may write your opinion on this
point based upon the trustworthy writings of the learned predecessors and endorse it with
your seal.
Answer:
In the name of God the Most High. The Shiahs in general and the majority of the Sunnis
belonging to the four schools and others (with the exception of a few ordinary men whose
views on the subject are out of the way) hold that Musha waqf is valid. Numerous authentic
traditions from the imams, peace be on them, have been handed down respecting Musha
charity, sadaqah, which clearly lay down that by sadaqah is meant either waqf itself or that
waqf is the most obvious kind of it. Therefore, the validity of such a waqf on account of its
being owned by a joint-stock company cannot be questioned (italics are mine). And as
possession is the condition for validity of a waqf, therefore the donor must hand over the
property either to him for whose benefit the waqf is made, or to the mutawalli, exactly in the
same way as he would have done to a purchaser to whom he had sold his share. In the case of
waqf he must give possession to the mutawalli. If he constitutes himself the mutawalli, he
must act according to the deed of waqf and must consider his possession as that of a
mutawalli and not that of an owner. If he has made a waqf of Musha property and given
possession, the waqf is valid and binding. If he has not given possession, he may revoke the
waqf during his lifetime. If the dedicator dies before giving possession, the waqf is null and
void.
God is the all knowing.
11 Shaban, 1325 A.H.
Seal of the Mujtahid
I certify the seal marked A on the margin of this paper to be that of Sheikh Abdullah
Mazandarani, the celebrated Mujtahid of Najaf, who made the same in my presence this 28th
day of September 1907.
Signed. M.H.M. British Vice-Consul
Karbala, 28th Sept., 1907.
The importance of this fatwa cannot be emphasised enough for, not only does it
confirm the validity of cash waqfs for the Shiites as well, but it also informs us about what
must have been an unusual way of establishing such waqfs in the year 1907, i.e., through

32
joint-stock company shares. First, the reader may be taken aback by the idea of using jointstock company shares as the corpus of a waqf. After all, joint-stock companies are known to
be a western invention. Consequently, we face the problem of establishing a waqf with
essentially a western financial instrument.
It is quite clear from the text of the fatwa that this did not bother the Hujjat al-Islam.
This is due to the fact that he considered a joint stock company similar to a Musha waqf.
Musha is the term used for properties that have not been divided among the various owners.
A joint-stock company would indeed be considered as a Musha on the grounds that although
its physical capital would be undivided, hence Musha, its cash capital can be clearly divided
into shares. Endowment of a property owned jointly by numerous individuals has constituted
a lively debate among the jurists. The crux of the problem boils down to the conditio sine qua
non of any waqf that only a privately owned property can be endowed. The problem of the
jointly held property is that its true magnitude and boundaries is not known. Consequently,
most jurists agree that before being endowed, the property must be divided among the owners
and each owners share clearly defined. Endowment of a share is permitted only after this
process.12 This is the reason why the Hujjat al-Islam has insisted that the founder
must hand over the property either to him for whose benefit that waqf is made, or to
the mutawalli, exactly in the same way as he would have done to a purchaser to
whom he had sold his share.
As a final note it should be added that the waqf of movables had already been
permitted by the Article 61 of the Iranian Civil Code (Lambton, 1991: 231). While the
Islamic Republic has permitted waqfs whose capital, corpus, is constituted of cash and
stocks. (Cabinet Decree no.95270, dated May 17, 1986, Article no.44)
II. Cash Waqfs in History and the Present
1. Introduction
Having presented the legal debates concerning cash waqfs, we are now in a position
to pursue our inquiry regarding the way in which these waqfs actually functioned in history.
For this particular problem the most important source that we have are the so-called Cash
Waqf Inspection Registers held in the Ottoman archives. There are basically two reasons why
we need to refer to these Ottoman sources: First, although, as it has been made clear above,
cash waqfs existed and continue to exist in many different countries, their most widespread
usage was observed in the Ottoman economy. Second, we are fortunate that the Ottomans
were meticulous record keepers. Consequently, the Ottoman archival sources that we have
are both plentiful and incredibly detailed. With such a rich source at their disposal,
historians were able to do detailed studies of the way these Ottoman waqfs had actually
functioned. In the next section a summary of a recent research made on these waqfs will be
presented (izaka, 1995). Thus the reader will be thoroughly acquainted with this institution
as it had functioned in history. In the rest of the chapter information will be presented on cash
waqfs existing in the rest of the Islamic world.
A typical eighteenth century Ottoman Cash Waqf Inspection Register contains the
following information:

a. The name of the waqf and the purpose for which it was established
b. The name of the mahalle, district, in which the endowment was registered
For the conflicting positions of the Maliki and Hanafi schools (particularly Abu
Yusuf) see, (Akgndz, 1988: 134-135).
12

33

c. The name of the trustee

d. The period of time covered by the census
e. Original capital of the waqf
f. Later additions to the capital of the waqf either by individuals or other waqfs
g. The balance of the new capital thus formed
h. The return obtained from the investment of the total endowed capital at the end of

the
year, the so-called, murabaha fi sene- kmile.
i. The purpose for which the annual return was designated, i.e., the expenditure, mesarif.
This section was followed by another one called zimem which included the following
information on borrowers:
j. The names of the borrowers
k. The amount of capital each borrower borrowed
l. The district where the borrower lived
m. The religious denomination of the borrowers
n. Gender of the borrowers
It is noteworthy that these registers provide this information to us in a standard way
for a period of more than 300 years. At this point it might be interesting to provide an actual
waqf case from the eighteenth century. In the introduction of the document the following
information is provided:
The account of the revenue and expenditure of the Muslim endowments for the
purpose of assisting the avarz and nzl taxes of the residents of the Orhan Ghazi
district of the city of Bursa during the trusteeship of Esseyid Halil A a, the trustee of
the said endowment from the beginning of the month of Muharram of the year 1200
(1785) until the end of the Zilhicce of the same year. 13
This particular cash waqf was endowed with an initial capital of 2,377.5 gru . To
this, the profit of the previous year was added which increased the capital to 2,544 gru . After
this, we observe an interesting phenomenon. This is the observation that three other waqfs
had contributed modest sums to the capital of this waqf. The implications of this will be
discussed below. The first contribution, 50 gru , was provided by the waqf of Ay e Hatun for
the purpose of reciting the mevlid. The second one, 85 gru , was provided by the waqf of
Hatim Hatun also for the same purpose. Finally, the third contribution, 50 gru , also came
from the waqf of Hatim Hatun this time for the purpose of buying candles for the Orhan
Ghazi waqf. The total capital of the endowment thus increased from the original 2,377.5 gru
to 2,729 gru , an addition of 351.5 gru altogether.
This enhanced capital was then distributed as credit to 20 individuals. These
investments generated a return of 257.5 gru , murabaha fi sene- kmile, which constituted
9.4% of the capital invested. Out of the amount generated, 86.5 gru were spent to assist the
payments of avarz and nzl taxes, to recite the mevlid, to buy candles, to pay the trustee
and the bookkeeper and for miscellaneous expenses. The remaining 171 gru was called the
ziyade ez masraf and was added the following year to the capital of the endowment.
This, in a nutshell, is a demonstration of how a cash waqf actually functioned. To
summarise: the endowed capital was distributed as credit to a number of borrowers and the
return from this investment was spent for religious and social purposes. If the return
exceeded the expenses, as in this particular example, the remainder was added to the original
capital of the endowment the following year. Enhancement of the original capital was not

13

Bursa Court Registers: B227/455-1/1b.

34
limited to the addition of the previous years profit; it also occurred when other waqfs
contributed to the waqf as well.
2. Cash Waqfs in the Ottoman Economy
In a society where health, education and welfare were entirely financed by gifts and
endowments, the cash waqfs were essential for the survival of the Ottoman social fabric.
Moreover, they also provided major injections of capital to the economy of the cities where
they functioned. The Ottoman courts approved cash endowments as early as the beginning of
the fifteenth century and by the end of the sixteenth, they had become extremely popular all
over Anatolia and the European provinces of the empire. Cash waqfs were established by
well-to-do individuals who allocated a certain amount of money for pious purposes. The
amount endowed had to be privately owned and the capital of the waqf was "transferred" to
borrowers who after a certain period, usually a year, returned to the waqf the principal plus a
certain "extra" amount, which was then spent for all sorts of pious or social purposes. These
vague terms "transferred" and "extra" have been used deliberately here. For, whether the
capital of the endowment was lent as credit to the borrowers and the return was, in fact,
nothing but the ordinary interest, constitutes a debate (Mandaville, 1979; izaka, 1993).
A summary of this debate, without going into the details, would be appropriate here.
First of all, Imam Zufars suggestion back in the eighth century that the corpus of the cash
waqf should be invested through mudaraba14 and the return be used for the original purpose
of the waqf did not find application in historical reality. In a separate study based upon a
sample of 1563 Bursa cash waqfs and their respective profit/capital ratios covering the period
1667-1805, izaka, (1993b) found out that only four of these waqfs resorted to profit and
loss sharing partnerships (mudaraba or musharaka/inan) while the rest produced remarkably
constant returns fluctuating within a narrow margin of 9 to 12%. This can be considered as
sufficient proof that the Ottoman cash waqfs lent money with a nearly constant return.
The question now is whether this arrangement should be called ordinary interest or
was it something else? To start with, Ottomans themselves never called it interest, riba. The
term they used was the so-called istiglal, which has been described as follows:
istiglal was outwardly construed as a sale: The borrower handed over to the
lender a piece of real estate, supposedly as a sale, but actually in a pawn. If the
borrower redeemed his debt after a year, the asset reverted back to him. In the mean
time, the lender leased the asset to the borrower (so that the borrower could go on
using it) and the rent which was often exactly 10% of the loan, was nothing but
interest. In short, we have here a simple interest bearing loan with a piece of real
estate as security (Gerber, 1988: 128).
Although, this arrangement may be dismissed simply as a cumbersome method of lending
with interest, it is important that from the perspective of Islamic jurisprudence, it was a fully
sanctioned instrument. From economic perspective, however, since it provided fixed return to
the capital lent, it was nothing but interest. To distinguish istiglal from the ordinary rate of
interest where the former acts in the economy just like the latter but is permitted by Islamic
jurisprudence, we shall call it economic interest. Rejection of Imam Zufars suggestion and
the insistence of the trustees to lend the corpus of the cash waqfs through economic
interest had far reaching consequences.

14

The reader can find substantial information on the mudaraba in the following
sources: (Udovitch, 1970) and (izaka, 1996).

35
We will now focus on this problem. Looking at the problem from the perspective of
capital accumulation, it can be envisaged that an entrepreneur could borrow money from an
endowment with a modest rate of economic interest. In short, a cash waqf could function in
reality just like a bank, with one difference; whereas a bank accumulates funds from a
multitude of savers and then transfers these to entrepreneurs and earns its profits through the
different rates it utilises (lending rate minus the borrowing rate constitutes the banks
profits), a cash waqf would actually distribute the lifelong accumulation of a single
individual, endowment capital, to borrowers and thus, in fact, function as an instrument of
capital distribution. Moreover, whereas the bank has to pay a fixed rate of interest to the
savers (borrowing rate), an endowment pays nothing for the fund it transfers to the
borrowers. Put differently, the cost of capital for an endowment would be zero! Thus, the
entire rate of return could be considered as profit, which would be spent for social and pious
purposes.
It can be further assumed that since an endowment utilised the savings of a single
individual, rather than the savings of thousands of people, it would have relatively less
capital at its disposal. So, the possibility of capital pooling among the endowments, i.e.,
supply side capital pooling, assumes great importance. Capital pooling on the demand side,
i.e., an entrepreneur borrowing from a multitude of endowments, is also, obviously, quite
important. Implications of these assumptions should be fully understood. What is in question
here is whether cash waqfs could fulfil the function of Western banks for Islamic societies.
Supply side capital pooling implies that substantial capital could be put at the service of the
entrepreneurs by a group of waqfs and demand side capital pooling implies that a single
entrepreneur could borrow from a multitude of waqfs to maximise the available funds at his
disposal for a single project.
The specific example presented above has revealed that endowments, indeed, applied
a process of capital pooling among themselves. This took the following form: founders of
smaller waqfs stipulated that a part of the annual return of their waqfs be set aside to be
submitted to the larger waqfs. Thus, supply side capital pooling was confirmed. On the
demand side, however, totally unexpected results were encountered. First of all, although the
average credit per capita borrowed had increased by 43% between 1749-85 in Bursa, the
amounts borrowed were quite modest; 53 gru , on average, in 1749 and 76 gru in 1785. This
was the first indication that the borrowers were not entrepreneurs but consumers. The total
number of these borrowers was calculated as 6,648 for the year 1767, another indication that
capital was not accumulated at the hands of a few enterprising individuals but was diffused
throughout the city'
s population of about 65-70,000. But then this conclusion had to be
subjected to a test, for it was possible that the data may have been repetitive. In other words,
we do not know if these approximately 6,000 borrowers were 6,000 distinct individuals or if
a particular group of people kept borrowing from a multitude of endowments in a given year,
i.e., actually practiced demand side capital pooling. This was a difficult question to answer.
The problem was aggravated by the fact that the Ottomans did not use family names. So,
other clues such as occupation and residence had to be utilised. In any case, aided by the
computer, it was established that only 7.5 per thousand of the borrowers had borrowed funds
from two different endowments in the year 1767.
Further research into this small group of capital pooling borrowers revealed that
these were the trustees who were borrowing from the very endowments that they were
managing themselves! This view is supported by another study, which showed that, in a city
famous for its silk industry, another profession that would most likely have utilised the cash
waqf sources, i.e., the silk sector, hardly did so. In fact, the ratio Silk Credits/Total Credits
never exceeded 3% during the period 1749-85 (izaka, 1993). The funds that these trustees
borrowed, moreover, were not spent for establishing or enlarging businesses but for lending
further at a higher rate of interest to the money dealers, sarrafs in Istanbul. In short, a

36
secondary capital market had emerged in the Ottoman economy with the cash waqfs
providing the cheaper money and the sarrafs re-lending it at a higher rate of interest to the
merchants and tax-farmers.
To conclude, research has revealed that cash waqfs, which originally appeared as a
promising and unique Ottoman institution of capital accumulation, actually functioned as an
institution of capital distribution. Capital pooling was certainly practised among the
endowments but the borrowers were mostly small consumers and the endowments funds
were not utilised to finance important business ventures. A tiny minority of borrowers who
did practice capital pooling did so in order to lend the waqf funds at a higher rate of return to
the sarrafs of Istanbul thus in this process creating a secondary capital market.
At this point we must ask several why questions. Why, indeed, did the Ottoman
cash waqfs not function like the Western banks and contribute to the process of capital
accumulation in the economy rather than limiting themselves primarily to the redistribution
of capital? Why, in other words, did they finance merely consumption rather than
entrepreneurial investment?
The answer lies in the method of lending and takes us back to Imam Zufer who had
suggested that the waqfs funds should be transferred to the borrowers as the capital of a
mudaraba partnership. In other words, Imam Zufer had envisaged a mudaraba partnership
between the cash waqf and the borrower; the former being the principal of this partnership,
and the latter the agent. We have, moreover, stated above that the trustees had refused to
apply Imam Zufars suggestion. While this author is not aware of any historical source
explaining this refusal, it can be deduced that the trustees must have been concerned about
the risks of a mudaraba partnership.15 In any case, probably concerned about such risks, they
applied not the recommended and completely legal mudaraba but the far more dubious
istiglal which was a legal device concealing a usurious transaction. While istiglal conformed
to the letter of the law, it violated its spirit by dangerously approaching the ordinary rate of
interest.
Since istiglal involved the submission of a substantial collateral in the form of a
house, the borrower was severely limited. Consequently, we should not be surprised if the
entrepreneurs could not resort to demand side capital accumulation i.e., in response to the
relatively small amounts of capital possessed by the cash waqfs, request funds from a
multitude of waqfs to accumulate capital. To do so, would have meant that they would have
had to provide several houses as collateral, as many houses as the cash waqfs they wished to
resort to! It was because of this risk averseness on the part of the waqf founders or the
trustees that the cash waqfs were limited to the role of capital distribution and could not
contribute to the process of capital accumulation.
Now that we have established that the cash waqfs could not provide funds to the
economy for entrepreneurial investment, we may wonder about the extent of other funds they
provided to the economy. First of all, it has been noted above that a two-tier capital market
appears to have emerged in the Ottoman economy, with some of the trustees borrowing from
their own waqfs funds at relatively low rates and then re-lending these funds at higher rates
to the sarrafs in Istanbul. Further research about the trustees has revealed that they were
becoming ever more important as borrowers. Obviously, it must have been a relatively simple
matter for them to borrow from the cash waqfs that they were controlling themselves. Since,
most probably, they did not have to submit their houses as collateral as everybody else had
to, they were in a unique position to borrow from a multitude of cash waqfs. Moreover, the
rate at which they borrowed was substantially lower than the prevailing market rate.

In many cases, the trustees were instructed by the waqf founders themselves to lend
at a specific rate.
15

37
Consequently, they must have earned substantial amounts by exploiting the difference
between the two rates of interest existing in the capital market.
All of the above supports the argument that cash waqfs were responsible for a largescale injection of capital into the economy. We will now attempt to quantify this statement
for the city of Bursa. Our analysis was based upon a sample of 25% and covered the period
1749-1785. Of the three Inspection Registers considered, the one from the year 1767 was the
most complete and therefore contained the most data. If we take 1767 as the year for which
we have the most complete information and multiply the data for that year by four, we obtain
a very rough estimation of the total number of borrowers and reach the conclusion that, in a
given year during the eighteenth century, more than 6,000 persons were provided with credit
by the cash waqf system in the city of Bursa.
As for the total amount borrowed by these people, which we have calculated in the
same manner, we reach the figure of almost half a million gru . Comparing this figure with
the tax-farm registers, it has been shown that the capital injected into the economy of Bursa
was nearly ten times greater than the amount withdrawn by the state through the tax-farm of
silk cloth press (izaka, 1995: 336). But we must not lose sight of the redistributive power
of the cash waqfs. The cash injected here was not a lump sum amount given as credit to a
select group. On the contrary, this amount saved by the privileged few was voluntarily
redistributed. Thus, injection and redistribution occurred simultaneously.
3. Decline of the Ottoman Cash Waqfs
At this point the reader may wonder about the relative staying power of the cash
waqfs vis-a-vis the real estate waqfs. Bearing in mind that some major sultanic real estate
waqfs could be maintained for centuries and many are still in service, it may be thought that
the real estate waqfs should have much greater possibilities for survival. But the relevant
question here is not the survival rate of some major sultanic waqfs, which could be extended
even over a millennium, but the average rate of survival of all. In any case, unfortunately, we
are not yet in a position to conduct comparative research because the survival rate of the real
estate waqfs in any particular locality has not yet been studied. But the survival rate of the
cash waqfs of Bursa has been calculated. Our research has revealed that slightly more than
20% of the Bursa cash waqfs survived for more than a century (izaka, 1995: 317-320).
Thus, although probably less impressive than the real estate waqfs, the survival rate of the
cash waqfs should not be under estimated.
If we look at the problem of survival not from the perspective of cash versus real
estate, but cash waqfs as a whole, we encounter a totally different picture. Thanks to recent
research, we have been informed about the substantial decline in the relative importance of
cash waqfs as a source of credit (ztrk, 1995: 26; eyhun, 1992). ztrk has shown that in
the year 1908 the total capital of the cash waqfs was equal to 90,750,000 gru and rose to
321,989,000 gru in 1923 and to 11,111,423,000 gru in 1943. He thus gives us the
impression that the system was doing perfectly well but Eldem informs us that in the same
year the Ziraat Bankasi, an agricultural bank, alone advanced 563,000,000 gru , as credit.
The credit advanced by the Ottoman Bank, on the other hand, had reached a staggering 1,102
million gru (Eldem, 1970: 234). In short, modern banks as suppliers of credit superseded the
cash waqf system.
Apparently there were two distinct reasons behind this decline: economic and
administrative. Let us first concentrate on the former. It has already been mentioned that the
cash waqfs charged a fixed rate of economic interest which did not change over the long
run. The rigidity of this rate was caused by conditions stipulated by the founders at the time
of the establishment of these endowments. Once determined by their founders, these rates
could not be changed in response to the changing economic conditions and any attempt to do
so was considered to be against the law.

38
While the rates charged by cash endowments thus remained fixed, there developed
other sources of finance, which were not hampered by such limitations. The sarrafs, money
changers, charged rates determined by the supply and demand for money. Consequently,
there developed a capital market in which two different rates of interest prevailed. It was
argued above that under these conditions, it would make sense to borrow money from cash
waqfs, which supplied the relatively cheaper capital and then sell this to the sarrafs who
would re-sell it with a mark-up to the public. It was further argued that the trustees of the
cash waqfs were in an ideal position to perform such transactions and indeed, it was shown as
evidence for the above argument that they were emerging as major borrowers of capital from
the very endowments that they controlled.
Even more definitive evidence supporting this idea has been found in the archives of
the Chamber of Commerce of Marseille. The correspondence of French merchants residing
in Istanbul inform us that, indeed, the market rate of interest prevailing in that city was
substantially higher than the economic interest charged by the cash waqfs of Bursa.
In one of the French documents, it is clearly stated by the two deputs Conston and
Reimond that the situation in Istanbul differs substantially from that of Europe.16 They report
that the sarrafs obtain capital at 12% to 13% interest, which they then lend to the members of
our nation with at least a 20% interest without any regard to usury prohibitions. This
approximate rate of 12-13% is roughly 2% above the rate at which the cash waqfs provided
capital. The 2% difference therefore may represent a mark up charged by the trustees when
they re-sold the capital to the sarrafs. That the sarrafs, indeed, borrowed capital from the
cash waqfs has been proven also by an original Ottoman document. 17 Moreover, the trustees
themselves could also become sarrafs. In this case, the profit of the trustee/sarraf would
increase up to 8% or more. In short, the trustee/sarraf would borrow capital cheaply from the
cash waqf managed by himself and lend it at a higher rate to a third party. This process
naturally closely resembles the essential character of conventional deposit banking and the
sarrafs may be considered the original deposit bankers in the Ottoman Empire.18
But the primary reason for the disproportionate financial powers of the two
institutions must be sought in their organisational structure: whereas the capital of cash waqfs
is constituted by the savings of a single person, that of the deposit banks is constituted by the
savings of the masses. It is true, some cash waqfs did apply what we have called above
supply side capital accumulation with one cash waqf donating part of its profits to another,
but this was basically of a voluntary nature and quite unsystematic. Consequently, the huge
discrepancy presented above concerning the relative financial powers of the two institutions
should not surprise us. This discrepancy would become even more striking if we take into
consideration the fact that the Ziraat Bank was only 20 years old when it had so obviously
superseded the cash waqfs, an institution that has been in existence since at least the fifteenth
century, as a source of credit.
Turning our attention to administrative reasons for the decline of the cash waqfs, we
must note a major development that affected the entire waqf system, not only cash
endowments but also real estate waqfs. This was the centralization drive initiated by
Abdulhamid I and continued rigorously by the following sultans, particularly Mahmud II.

Archives of the Chamber of Commerce, Marseille: (ACCM, J 183). I am grateful

to Edhem Eldem for this information.
17
Prime Ministry Archives, Istanbul: Cevdet Maliye, 2144
18
Evolution from charitable foundations to banks has also been observed in Europe.
All the seven banks of the 17th century Naples were engaged in charity and functioned
much like the Ottoman cash waqfs granting loans upon pledge. The details of how
these Italian charitable foundations evolved into the powerful public banks and the
comparison of this process with the emergence of powerful Ottoman sarrafs need to
be searched separately (Avallone, 1999: 111-115 and Kazgan, 1991).
16

39
Although this process will be analysed in detail later, it should suffice here to note that cash
waqfs also could not escape Mahmuds iron grip. A directive promulgated on the nineteenth
Cemaziyellevvel 1280/1863 made it clear that cash waqfs fell within the jurisdiction of the
Evkaf- Humayun Nezareti, Ministry of the Imperial Endowments. Article 14 of the directive
instructed the trustees that the annual return of endowments not assigned for a specific social
service must be sent directly to the treasury and recorded in the registers rather than kept by
the trustees. This Article is of interest not only because it indicates clearly that the cash
endowments did not escape the centralization drive of Mahmud II, but also because it
confirms the arguments made above pertaining to the tendency of the trustees to exploit the
resources of the cash waqfs to their own advantage. It is self evident that the trustees did not
just keep the money in their possession but lent it at a higher rate to the sarrafs or to the
public.
The demise of the cash waqfs under the Republic can be summarised as follows. As
the Ottoman Empire was dying in Istanbul, cash waqfs contributed substantially to the newly
established nationalist government in Ankara. The Law of Endowments dated 1935 had
articles pertaining to the profitable administration of the cash waqfs. The death warrant was
issued in 1954 when all the capital of these endowments was transferred to Vakflar Bankasi,
the Turkish Bank of Endowments. The group A shares issued by the bank were purchased by
endowed cash. These shares constituted 55% of the banks capital and remained the property
of the General Directorate of Endowment. Consequently, they could not be sold to third
persons (Hatemi, 1979: 635). The shares in group B, constituted 20% of the capital of the
bank and were owned by the endowments managed by their own trustees. In 1967 another
law introduced a rule of conversion, istibdal, and made it obligatory to convert all endowed
cash into bank shares thus destroying whatever was left of the judicial personality of the cash
waqfs. Ironically, however, 1967 can also be considered as the year of the re-birth of modern
Turkish cash waqfs. Put differently, while the judicial personality of the Ottoman cash waqfs
was being destroyed, new and exciting possibilities were being opened up for the Turkish
cash waqfs. These developments will be presented below.
4. Cash Waqfs in Syria
It was Bruce Masters who challenged, for the first time, Mandavilles assertion that
the jurists in the supposedly more pious Arab provinces of the Ottoman Empire did not
sanction cash waqfs. In view of the solid data provided by Masters from Syria, Mandavilles
assertion is not anymore valid (Mandaville, 1979; Masters, 1988: 162-163). The earliest
evidence Masters has been able to find dates from 1597 when the governor Ahmed Mataf
established a cash waqf with a huge capital of 10,000 gold dinars. The terms of the
endowment fixed the economic interest rate at 10% and stipulated that the money should
be lent to persons who held wealth or office. The policy of the waqf was thus to lend
conservatively at minimum risk to a select group of borrowers, but the return to be earned
was to be spent for the benefit of the poor. More specifically, Matafs waqf was a so-called
avarz vakf designed to reduce the burden of extra-ordinary taxes levied on a particular
district of the town.
Another specific example illustrates how this worked in practice. Consider a waqf
established by a certain Mehmed A a for the poor of the quarter of al-Farafira in Aleppo.
From the accounts for the year 1659-1600 presented to the local judge we learn that the
principal of the endowment was a much smaller 500 gru which had yielded an economic
interest, murabaha fi sene- kmile, of 100.5 gru . Thus the rate of economic interest,
20%, was twice as much as Matafs waqf. Of the return generated, 95 gru was spent, again,
to help the district pay its taxes. The remainder of the money, as well as the 4 gru left from
the previous year was spent for unnamed projects benefiting the district.

40
Another observation of Masters pertains to the orphanages, which apparently also
functioned as cash waqfs. The interest charged by these was more or less the same as other
cash waqfs, i.e., in the 10-20% range.
In nearly all the cases, Masters appears to have been impressed by the very low rates
of default prevailing in the cash waqf sector of Aleppo. For Masters, the explanation for
these low rates lies in the nature of Muslim society, in which families constituted corporate
bodies, responsible for the actions of individual members. Most loan agreements established
the responsibility of a guarantor, kefil, for the debt. If the borrower defaulted, family
members could be held responsible for repayment of a relatives debt for up to 15 years after
the loan was contracted. Should the debtor be present in the city but unable to repay the loan
on schedule, two options were possible.
The first involved rescheduling the loan into instalments until the loan was repaid.
Setting up the reschedulement often prompted disagreement among the parties and led to
court cases. In one of these cases, the judge ruled that instalments would only be legal if they
had been stipulated at the time the loan was contracted or if both parties had agreed in court
later on to a scheme of repayment. Failing either of these conditions, the loan had to be paid
in total at the time stipulated by the original loan contract. The alternative involved delaying
the payment until a later specified date. This also required the agreement of both parties in
court before it became legally binding.
If either of these compromises failed and if there were no family members to assume
the responsibility of the debt, the debtor would be jailed. In this case, however, another
system came to the aid of the debtor. Assuming that he was known to be a decent person,
residents of his quarter, mahalle, would come together and collectively bear the
responsibility of his debt. In one particular case dated July 31, 1718, Muslim residents of a
mahalle collectively assumed responsibility for a Christians debt and had him released.
5. Cash Waqfs in Egypt
Various sources have revealed that large cash sums were being dedicated in
eighteenth century Egypt to various religious institutions such as the famous al-Azhar as well
as to lesser zawiyas and shrines. Cash sums were also allocated for the periodic celebrations
of the mawlids of the Prophet and other saints (Behrens-Abouseif, 1994: 158). We are also
well informed about a certain Abidin Bey, who was the amir al-hajj in the 1620s and who
developed a whole quarter of Cairo known today by his name. The development was
achieved through the waqf system, which included extensive real estate as well as cash. The
cash was endowed as waqf for the poor of the holy cities.
Concerning modern times, unlike Turkey, the Egyptian cash waqfs were apparently
allowed to maintain their judicial personality. For we are informed by Anderson that Article
8 of the so-called Law of Rules Relevant to Waqf, dated 1946 allows the establishment of
cash waqfs with stocks and shares (1952: 263). Anderson also says that there has been a shift
in Egypt from the more difficult Hanafi law to the Maliki law in waqf affairs.
the Hanafi law previously applicable, only allows a waqf of movables as appendages
to immovables or as sanctioned by ancient custom, but the Maliki doctrine which makes no
such restriction was plainly more suited to modern life. The view of Abu Yusuf previously
dominant, allows the waqf of an undivided share in indivisible property almost without
restriction, but the Maliki view, far stricter in this particular, seemed preferable, in view of
the disputes and complications to which the contrary policy inevitably gives rise. The
enunciation of this principle demanded an express reference to the validity of a waqf of
stocks and shares, provided the companies concerned do not transgress the Islamic
prohibition of usury. To these provisions, again, parallels may be found in Articles 15 and 16
of the Lebanese Law. (Anderson, 1952: 263)

41
We need to elaborate on the difficulty pertaining to the Hanafi law, which allows the
waqf of movables subject to ancient custom. Thus, notwithstanding Imam al-Sarakhsis
report that Imam Muhammad had confirmed the waqf of movables as valid subject to custom
existing at his time as well as subject to custom that may arise in the future, Egyptian
authorities considered the Hanafi law as too rigid and preferred the Maliki law. There may
have been a number of reasons for this. On the one hand, Maliki law may have been preferred
to the Hanafi as part of a process to discard the vestiges of the Ottoman era. On the other, the
technical difficulty embodied in the concept of custom may also have prompted this process.
Since the establishment of a waqf with joint-stock company shares must have been a new
practice, the authorities may have preferred the Maliki law, which does not have any
restrictions regarding customs.
Ironically, the Maliki law which was preferred in view of its flexibility concerning
custom, was also preferred for its relative stringency concerning the waqf of undivided
share, Musha. It is furthermore noteworthy that the Maliki stringency concerning the waqf
of Musha also led to an indirect confirmation of the modern cash waqfs. That the same
provisions can also be found in the Lebanese law is also interesting.
The permission granted by Article 8 to establish cash waqfs with the stocks and
shares of joint-stock companies has had important repercussions for ibdal/ istibdal in Egypt.
When a waqf property was sold off, the amount of money for which it was traded is called
amwal al-badal. Previously, these amwal al-badal were not immediately put to use, they
were kept idle for years and depleted by inflation. In the year 1942, for instance, the total
amount of idle cash had reached PE 670,938 (Anderson, 1952: 265). Articles 14 and 15
altered this. They authorised the courts to purchase with the amwal al-badal in their treasury
any moveable or immovable property, which would provide a new source of income for the
waqf in question. Courts may also give permission to invest these amwal al-badal
temporarily to generate income in the short run. It is envisaged that a court would do this in
response to the request of the interested persons, but in cases where such a request did not
materialise within a year from the date when this law came into force, a special court, the
Mahkamat al-Tasarrufat in Cairo, on the demand of the Minister of Justice, was allowed to
expend them in purchasing sources of income in the form of moveable or immovable
property.19 If the capital of numerous waqfs had been sold off and the amwal al-badal
belonged to these waqfs jointly, then all property so constructed or bought was held jointly
by them in proportion to the share of each therein.
Thus, the 1946 Law in Egypt introduced several reforms simultaneously. It first
permitted the establishment of cash waqfs with stocks and shares of joint-stock companies
(Article 8), and then using this, attacked the problem of idle funds generated by the sale of
derelict waqf properties. It is thus permissible in Egypt to sell such waqf properties on the
condition that the cash obtained is used to establish a new cash waqf.20
The practice of converting real estate properties of the waqfs into cash was boosted
with the Nasserite revolution when the state assumed jurisdiction over all the waqfs through
the Ministry of Waqfs. In 1957, Law 152 conferred upon the state the right to substitute
money for land, i.e., to practice ibdal/istibdal on a massive scale. This law, in fact, paved the
way for a massive land reform and the nationalisation of the waqf lands by transferring the
ownership of these lands to the Land Reform Committee. The trustees of the waqfs were
issued with Land Reform Bonds for the confiscated lands. When the bonds matured, the
capital was to be transferred to the government and invested in development projects. The
trustees were then supposed to receive, on behalf of their waqfs, interest due on the bonds
and later profits from the invested capital. In this way, the real estate waqfs of Egypt were

Italics are mine. Instead of moveable or immoveable property, Anderson uses the
terms; real or personal property.
20
Anderson has argued: The right to buy property of a nature different from that of
the original waqf may be supported from Hanbali authorities (1952: 265).
19

42
converted into cash waqfs with shares in government development projects (Baer, 1969: 9192).

6. Cash Waqfs in Central Asia

Our information about the existence of cash waqfs in Central Asia is extremely
limited. Although Bellr-Hanns latest work, referring to the Swedish missionaries reports,
reveals how the waqf law was applied in Kasghar, it is limited to real estate waqfs only
(forthcoming). We are informed by an earlier work that such waqfs comprised about eight to
ten percent of the total cultivable land in Central Asia (Yediyldz, 1986: 159).
Concerning the cash waqfs, our primary concern here, McChesney makes the simple
argument that since this region was also predominantly Hanafi, there is no reason why these
waqfs so popular in the Hanafi Ottoman lands should not also find application in Central
Asia. Although this statement appears to be conjectural, McChesney does support it with a
Russian source (Dzhalilov, 1: 45-49) pertaining to Uzbekistan.
More substantial and direct evidence has been provided by Utyabay-Kerimi who has
shown that the cash waqfs were flourishing in the Ural-Volga region during the nineteenth
and twentieth centuries when Turkic capital began to flow in. More specifically, reference
has been made to the cash waqf of Ahmed Bey Husainov, which had a corpus of 1,000,000
rubbles. Sherif Yaushev, a merchant from Tashkent, on the other hand donated 35,000
rubbles for the masjid and madrasas of the city of Troitsk. The well-known Galiya madrasah
in Ufa has survived thanks to the generosity of local bays like Nazirov, Janturin, Usmanov,
etc. Between
1906 and 1916 more than 70,000 rubbles had been donated to this institution alone.
According to the official documents dated 1911, in the guberniia of Kazan the total
cash capital of the waqfs reached 22,400 rubbles and in the guberniia of Orenburg it was
262,045 rubbles. In the same time the waqfs in the Crimea owned 351,000 rubbles without
taking into consideration the 22,000 desyatin of land worth 400,000 rubbles, which were lost
after 1891 (Utyabay-Kerimi, 1994).

7. Cash Waqfs in India

We have seen above, at the beginning of this chapter, how an Indian jurist-scholar A.
Al-Mamun Suhrawardy had visited Istanbul to study Ottoman jurisprudence concerning cash
waqfs. His Article, which was published in the Journal of the Royal Asiatic Society of Bengal
in the year 1911, appears to have been most influential. For, the Mussalman Waqf Validating
Act of 1913 has sanctioned these waqfs and put an end to the conflict previously prevailing.
In most cases in India, a combination of Imam Shafiis and Hanafi Imam Muhammad
al-Shaybanis principles is followed and the waqf of movables is held to be valid subject to
custom. In general, a property, which satisfies the following conditions, can be endowed:
a. The property must be tangible property (mal)
b. The property must be capable of being used without being consumed (Shafii
position).
According to Suhrawardy, movables include cash, money shares in companies,
securities, stock, etc. The objections of some of the Hanafi scholars notwithstanding, it came
to be recognised that the waqf of everything would be valid providing there is custom in any
particular locality. Concerning the validity of the waqf of movables in India, there was a
conflict before the passing of the Waqf Validating Act of 1913. Indeed, the High Courts of
Madras, Bombay, and Calcutta had ruled against the waqf of movables, declaring them void.
The Privy Council had left the question undecided. The situation was clarified by the Waqf
Validating Act of 1913, which permitted a waqf of any property including the movables
i.e.; shares in joint stock companies, notes and even cash.

43
The progress towards this stage took the following route: in Abu Sayid v Baker Ali
case <(1901) ILR 24 A11 190> it was said that a waqf even of coins or shares in a joint stock
company was not invalid. Thus, this 1901 case and the others from 1907-1909 were in
conflict. The situation was clarified and finalised by the Mussalman Waqf Validating Act of
1913. Section 2i of this act is very wide and includes every kind of property mentioned
above.
Section 3 of the Central Waqf Act of 1954 also confirms the foundation of a waqf by
any type of property whether movable or immovable. It has been held judicially that even the
government promissory notes can be endowed. Finally, in the Mirza Yakub v Mirza Rasul
Baig case, <AIR 1923 Oadh 254> the waqf of cash money was held as valid and in the
Abdulhamid v Fateh Muhammad case <PLD 1958 Lah 824> it was held in Lahore, Pakistan
that a waqf of cash will be valid provided the fund was not intended to be consumed.
After the passing of the Mussalman Waqf Validating Act of 1913, Indian courts
declared waqf of any property valid. In the majority of cases the courts have treated
endowments of movable property, government promissory notes and shares in joint-stock
companies and cash as valid. But as late as 1947, in the Ghulam Mohiuddin v Hafiz
Abdulrashid case <AIR 1947 A11 127, ILR 1947 A11 334, 1947 ALJ 232> the Allahabad
High Court took a different view and held that the waqf of money decree is not valid. But it
was further decreed that if there was a custom to the contrary, then such a waqf would be
valid (Qureshi, 1990: 76). Thus, the Allahabad court preferred to adopt the strict Hanafi
reasoning and reach the same result. For, obviously, establishment of cash waqfs was the
prevailing custom in India, as all the other cases mentioned above would indicate.
The following case should illustrate how a Shiite cash waqf operates in India.
Muhammad Ali Shah, a Nawab Ruler, built in Lucknow, the Husainabad, an imambarah in
the 1850s. An imambarah is a Shiite building erected as a meeting place of the devoted to the
rememberence of the events that took place in Karbala. The Husainabad endowment had a
yearly income of Rs.157,606. The Rs. 48,000 of that sum was cash. Thus we are talking
about a hybrid real estate/cash waqf. This Rs. 48,000 was the interest on a loan, which the
English had extracted from Muhammad Ali Shah and then converted into East India
Company stock.
This annual revenue was spent for no less than 12 different charitable purposes. The
bulk of the funds were earmarked for the maintenance of the buildings (monsoon ruined all
buildings, only the stone buildings could survive). The salaries of the endowments staff were
another major source of expenditure. The staff consisted of religious functionaries as well as
the cleaners, the watchmen, etc. Shiite ceremonies commemorating the events in Karbala and
the provision of food in these elaborate ceremonies constituted another major expense item.
The Muharram ceremonies are still financed by the endowment. Since the Nawabs
supported about 70,000 people, the number of pensioners is quite large (Kozlowski, 1985:
28-30). The numbers of these beneficiaries and the rupees decline has led to a massive
reduction in the amounts distributed. The poor nawabzadahs who come along every month
to collect their stipends remind us of one of the dangers facing cash waqfs that unless the
corpus as well as the returns it generates are systematically reinvested, changing economic
conditions will diminish the income of an endowment.
According to the Central Waqf Act of 1954, any person who wishes to establish a
new cash or real estate waqf is obliged to register it with the State Waqf Board. There are
registration fees to be paid and the waqf deed must be provided. If the deed has been lost,
approximate information is provided. The Board demands to know the following from each
newly registered waqf:
1. Number and date of registration
2. Name and address of the waqf
3. Particulars of waqf properties
a. Immovables:
i. Location

44

ii. Area
iii. Value
iv. Details of superstructure if any

b. Movables
i. Description of the movables; whether government securities or bonds, etc.
ii. Face value
iii. Other details

4. Particulars of annuity and grants received from other sources or the government
5. Estimated income and expenditure

Another case, CWT v. Trustees of H.E.H. Nizams Family Trust is interesting from
several perspectives. This case pertained to a huge cash waqf established by the late Nizam
with a capital of rupees nine crores. The corpus was divided into 175 equal units. Out of
which income;
a. 5 units was allocated to a reserve fund,
b. 3.5 units to a Family Trust Expenses Fund,
c. 166.5 units were allocated among the relatives.
Each beneficiary was entitled to only the income of the units allocated to him during
his or her lifetime. The reason why this waqf ended up being a court case is that the Income
Tax Authority demanded that the mutawalli pay income tax. The conflict between the income
tax collector and the beneficiaries lasted for many years and the case was finally brought to
the Supreme Court. We will refer to the complicated problem of the Indian waqfs tax
responsibilities below.
8. Cash Waqfs in Malaysia and Singapore
In Malaysia the waqf system is greatly complicated by the fact that there is no federal
law subjecting all the waqfs to the same rules and regulations. Although we will present a
summary of the organisational structure of the Malaysian waqf system later, it should suffice
here to note that in Johor and the Federal Territory it is possible to establish waqfs in the
form of cash funds and bank accounts (Top, 1991: 122). In the rest of Malaysia also, with the
exception of foodstuffs and plants, the waqf may be of either immovable or movable property
(Gordon, 1975: 277). Thus we have the basic Shafii condition that the corpus should not be
consumable.
Another interesting application in Malaysia can be observed in the field of high
finance. The revenues of the Religious Departments of various states, which are partially
constituted of waqf revenues, have been invested in the Islamic Bank Malaysia and the
Takaful Co. Actually, 25% of the equity of the Islamic Bank Malaysia has been provided by
these religious departments. As for the Takaful Co., in 1991 the paid up capital of this
company was equal to RM 10,000,000. Half of this amount was owned by the Islamic Bank
mentioned above and the other half by the religious departments (Gordon, 1975: 141).
Thus what we have here is the investment of waqf revenues as equity finance with
the newly established Islamic financial institutions. At this point we wonder if this
arrangement can be called a modern cash waqf. Bearing in mind that unlike the situation in
Turkey where the privately endowed cash of the historical cash waqfs was pooled together
and formed the equity of a huge bank, Vakflar Bankas, thus losing their judicial personality
in the process, in Malaysia the cash invested was not endowed, did not have judicial
personality to start with, and belonged to the Public Treasury, bayt al-mal. The returns
generated by the Malaysian Islamic Bank regularly accrue to the Islamic Departments and are
used for the benefit of the Islamic community. Moreover, the invested cash belonging to the
Religious Departments has perpetual character since we may assume that the departments
would not normally withdraw their cash. But despite these similarities, we cannot consider
this arrangement as cash waqf in the classical sense, since the endowed cash is not privately

45
owned, mulk. But the arrangement is certainly interesting and demonstrates the capability of
the Islamic financial institutions to evolve.
Another interesting case, Ashabee v. Mohammad Hashim, demonstrates the validity
of cash waqfs in Malaysia. Accordingly, a bequest for $400 was made for the maintenance
of the testators wife and to be spent for kandoories. The endowment was deemed void on
the grounds that it was not known how much of the return of the $400 was to be spent for the
wife and how much for the kandoories. It is noteworthy that the rejection was due to the
obscurity and not due to the nature of the capital endowed.
For Singapore we have more detailed information. First of all, in Singapore an
endowment is defined as any endowment in land or money to be given in support of any
Muslim mosque or school or for charitable purposes (Gordon, 1975: 288). According to the
1995 Annual Report of the Majlis Ugama Islam Singapura (MUIS), the supreme authority in
Singapore for all Muslim affairs, there are altogether 47 waqfs that are registered. Eighteen
out of these appear to be (or should be) cash waqfs, i.e., 38%. This is because, the annual
report of MUIS indicates that these waqfs do not have any fixed assets and do not earn rent.
Their income is in the form of returns from cash investment either in the form of bank
deposits or dividends from securities or reassessment of securities.
Recent research by Khatijah Shaik Abu Bakar, a Singaporean graduate student at
ISTAC, however, has revealed that these eighteen waqfs are in a transitory stage: they were
originally real estate waqfs but were acquired by the state of Singapore. The state paid cash
as compensation. Thus we are talking about a case of forced ibdal. It would be of great
interest what the future will bring to these waqfs. They may become fully-fledged cash waqfs
if they begin to utilize the returns generated by their cash corpus for their original purpose.
They may also be engaged in a further istibdal and convert their cash into new real assets.
What is needed here, however, is the recognition that the cash deposited by the state still
constitutes a waqf, an important legal procedure possible in Iran.21
The total value of the assets of these transitionary waqfs amount to S$1,054,263.
Since the total value of all the registered awqaf in Singapore is equal to S$92,885,669, they
constitute a mere 1% of the total value of the registered awqaf in 1995.22 The explosion of
land values in Singapore can explain this discrepancy. This means that while real estate
waqfs have become enormously rich, cash waqfs growth rates were indexed to the prevailing
rate of interest. The following example should illustrate the point: when the MUIS had 4
town houses built on a plot of the well known Jabbar Waqf at a cost of $1.6 million, the
annual rental income from the property shot up 126 times from $500 to 63,000 (Ibrahim, Z.,
1994: 72).
It might be appropriate to summarise a special case here: the Muslimin Trust Fund
Association of Singapore founded on the 31st August 1904. The association was founded by
cash donated by the famous Alsagoff and Co. and various other Muslim businesses and
individuals. The total amount of cash donated amounted to $ 864.47 and was intended for the
financing of burials of poor Muslims, the support of the Muslim orphans, the support of the
Alsagoff School, etc. The original fund was expected to be supported further by alms giving,
sadaqa, in the mosques. It was stated in the Objects of the Association that the alms boxes
placed in the mosques would be opened once monthly and the money found was to be utilised
as follows:
a. 2.5% of the total would be handed over to the Imam of the mosque for the upkeep
of his mosque
b. 97.5% would be deposited to an account to be opened with the Hong Kong and
Shanghai Banking Co., in Singapore to the credit of the association
21

See the second Cabinet Decree dated May 17, 1986, Article 44 of the Islamic
Republic of Iran, presented below.
22
Annual Report, (Singapore: MUIS, 1995), pp. 54-55.

46

c.

The deposited money (plus the interest?) was to be used for the purposes of the
association stated above.

In the year 1965 the association had an outdoor dispensary, an Arabic school, an
orphanage and managed 5 mosques (Ibrahim, 1965b: 47-49).
Thus, in both Malaysia and Singapore cash waqfs exist but in each they are in a
dormant state. Another common point between these countries is the excessive centralization
of their waqf systems. As in Turkey, a dramatic and sweeping move of wiping off their
judicial personalities and merging them into a huge bank has not taken place. It is
nevertheless true that all the Malaysian and Singaporean waqfs, whether cash or real estate,
have been affected by massive centralization and so we will now turn our attention to this
universal phenomenon.

CHAPTER FOUR: CENTRALIZATION OF THE WAQF SYSTEM

CHAPTER FOUR: CENTRALIZATION OF THE WAQF SYSTEM

I.

Introduction

We are now in a position to take into consideration the questions we have asked at
the beginning of this book, namely:
1. Why does the state feel the need to centralise and even to destroy the waqf system?
2. Since even the state had to obey some rules, what were the legal premises behind the
states interference?
3. Was the process of centralization and the pursuing destruction linear or cyclical?

48

In what was probably the very first attempt at a massive centralization of the waqf
system, the Fatimid caliph Al-Muizz decreed in 979 that all the assets of the awqaf were to
be handed over to the Public Treasury, Bayt al-mal.23 Within this framework, the revenue of
all the waqf assets was farmed out for 1.5 million dirhams. This proved to have been
disastrous and led to a substantial decline in the revenues of the waqf system, so much so that
even the mosques could not be properly maintained. By the reign of caliph al-Mustansir
(1036-94), the central control broke down completely (Cuno, 1992: 20). The sorry state of
the Egyptian awqaf was also observed by Salahaddin Ayyubid who launched a massive
reform immediately following his conquest. The positive effects of the Ayyubid reforms were
reported, centuries later, by Ibn Khaldun (1958, II: 435).
It is timely to consider the implications of this episode, for centralization of the
waqfs is a theme that is repeated throughout Islamic economic history. The importance of the
issue will become clearer in view of the fact that centralization culminated during the
nineteenth and twentieth centuries in a massive process of deliberate destruction of the
system. To understand this dramatic phenomenon we must first of all analyse the forces,
which prompted the centralization.
To be sure, there was not one but a number of reasons for the states recurring need
to do this and subjugate the waqf system. A compelling argument may be linked to the
problem of provisioning. Under the premodern conditions of fixed land and technology, any
expansion of privately controlled land at the expense of state controlled land would
jeopardise a regular and reliable supply of the basic foodstuffs for the masses. This is
because; the privately owned lands would be allocated, in response to the market forces, for
those crops, which command the highest price. Times of plenty and good harvests of the
basic foodstuffs would mean that these particular crops would be neglected by private
producers. Taking into consideration the poor state of road transport, it follows that a bulk
transfer of the basic foodstuffs would be dreadfully expensive. Thus, we have an explosive
situation here, while on the one hand, basic foodstuffs would be neglected by land owners
under favourable conditions as predicted by the Cobweb Theorem, on the other, due to the
poor state of roads and transport technology, a bulk transfer of basic foodstuffs would be out
of the question. Under these conditions, the slightest change in weather conditions might
disrupt food supply and a serious one could lead to famine, riots and even to a Malthusian
epidemic and loss of population.
The first thing the state could do, under these conditions, would be to try to curb the
production of the cash crops and force the producers to concentrate on growing grain instead.
It was for this reason that, if not before, at least starting with the famine-caused uprisings in
the city of Prusa (modern Bursa) during the early years of Domitians reign (81-96 AD), the
Roman emperors had encouraged the production of essential foodstuffs and curbed cash crop
production (Rostovtzeff, 1929, I: 165).
But, there was a limit to how the state could force the producers to plant those crops
that it prefered. This limit was obviously the division of the available land between private
and state owned lands, in short, property rights. It can be argued that under the conditions
described above, ceteris paribus, the larger the state owned lands the more reliable would be
the supply of basic foodstuffs. This particular Roman logic reappears a millennium and a half
later behind the Ottoman policy, which declared all grain producing lands as state property
and limited private ownership of land only to the orchards. Thus about 90% of all arable
lands were placed by the Ottomans under state control (Inalcik and Quataert, 1994: 105).
Moreover, we have to note that waqf land functions in reality as though it is in semi
private ownership. This is particularly true concerning the question as to which crops to
plant. Such decisions were obviously taken by the trustee of the waqf without any
interference by the state. Under these conditions, a significant expansion of waqf property at
23

For other early examples of centralization, see (Lambton, 1991: 27-28).

49
the expense of that of the state would be viewed with concern for two reasons: the continuing
need to provide the masses with a reliable and abundant supply of basic foodstuffs, as
mentioned above, and the potential loss in tax revenue. The concern for loss in tax revenue
was naturally relevant for those regions (and times) where waqfs were exempted from tax
responsibilities.
Now we can turn our attention to the difficult legal issues. Since a waqf is considered
to be the property of God, how can the state confiscate it? The answer is that it cannot, unless
of course, the waqf was unsound, gayr-i sahih, from the point of view of Islamic law, to start
with. The soundness here means that the original capital of the waqf must be privately
owned. But then, was land, the most basic asset of a waqf, a privately owned property?
Ownership of land constitutes one of the thorniest issues in Islamic law. First of all,
the systematic law books do not specifically treat the issue of land ownership. But there are
independent treatises on the subject written by jurists such as Abu Yusuf (1982), seeking to
legalise existing or surfacing conventions in the field of land holding and land taxation.
A careful look into the nature of state ownership of conquered lands in Islamic law
reveals that, as in Roman law, there were basically three fundamental elements: rakaba
(dominium eminens) or ownership; tasarruf (usus) or possession; and istiglal (fructus) or
usufruct (Inalcik and Quataert, 1994: 106). Each one of these elements was treated separately
under the Islamic law; the state retained the rakaba, ownership, and what it handed over to
the ordinary citizens were merely the rights of possession and usufruct. Hence the confusion;
archives are full of documents indicating the free sale and purchase of land by ordinary
citizens. Consequently, those readers unaware of these three independent elements, are often
led to think that a peasant was free to sell his land, whereas what the peasant was permitted
to do in these conquered lands was merely to sell his tenancy rights (Aghnides, 1916: 375376). Thus, when the second caliph Omar, allowed the original landowners in the territory
situated between the Euphrates and the Tigris to keep their land subject to the payment of a
special tax, kharaj, it should be understood that they were permitted to retain not the
ownership but the usufruct. Thus, in practice, the sale of a piece of peasant land was
accomplished by exchanging its usufruct for an amount of money (Cuno, 1982: 81).
This brings us directly to the question of how the Caliph Al-Muizz in the year 369
A.H., or more than half a millennium later the Ottoman sultans, could revoke the waqfs.
These rulers could do so by basing their actions on the principle of inalienability of the
states ownership. After all, the state had retained the ownership of land and handed over to
the landlord the possession, and to the farmer, the usufruct, as separate elements. Since, with
the ownership firmly in the states hands, the landlord who possessed the land did not
actually own it, he had no right to endow it in the first place. Such endowments were
permitted only exceptionally and subject to the Sultans approval. In such cases it was not the
ownership of the land, which remained firmly in states hands, but rather, the tax revenue
generated by it that was endowed. That is to say, instead of collecting the taxes payable by
the peasantry, himself, the Sultan permitted this revenue to be endowed. Since this is not the
usual method of establishing a waqf, such waqfs were known as unsound, gayr-i sahih, or
irsad (Akgndz, 1988: 424). These complex legal issues are clarified by Baber Johansen as
follows:
Beginning in the Fatimid period Muslim rulers tried time and again to confiscate the
waqfs and to treat them as lands belonging to the state. This tendency reached its climax
under the Ottoman ruler Mehmed II who tried in the 1470s to sultanize all arable lands
including the waqfs. He recognised only orchards, vineyards and plantations as private
property The Ottoman system of land tenure was clearly based on the assumption that
arable lands belonged in principle to the state. Ownership rights of private persons or pious

50
foundations were recognised only if sufficient proof for them existed.24 Consequently,
verifying the validity of property deeds became one of the strongest weapons which the
public treasury had for controlling arable lands. In the course of verifying the deeds, the
authorities could refuse to acknowledge the claims and instead incorporate the lands
into public domain. (Cuno, 1982: 22).
Concerning the question of the process of centralization or whether this process was
linear or cyclical, the evidence presented above indicates that the latter was the case. We
have already noted above that Caliph Al-Muizzs efforts were thwarted by Salahaddin
Ayyubid. It is also well known that more than half a millennium later the Ottoman Sultan
Mehmet IIs similar efforts in centralization were also thwarted by Bayezid II. In short, until
the nineteenth century, centralization policies were often followed by decentralization. What
makes the nineteenth and twentieth century centralizations unique is the fact that they proved
to be lasting. Indeed, since the re-Islamising states did not reverse these policies during the
twentieth century, the waqfs all over the Islamic world remain firmly centralised and
controlled by the state.
It is appropriate at this point to explain why the centralization process of the
nineteenth and twentieth centuries proved to be lasting. To start with, the nature of state had
changed in the Islamic world. If we focus on the Ottoman Empire, the latest research has
revealed that the Ottoman state had gone through a process of transformation: whereas the
pre-eighteenth century Ottoman state was accommodative of the conflicting rival groups
and institutions and tried to play a redistributive function, massive inter-state competition
had transformed the nineteenth century Ottoman state into a totally different dimension. The
state had now acquired its own raison dtre and ended up being far less tolerant and
accommodative of the rival groups and institutions. This modern Ottoman state was now
above all these groups and institutions and did not hesitate to eliminate them if it suited its
purpose. The nineteenth century onslaught on the waqfs differs from the earlier ones in that
whereas waqfs were originally among the rival groups, which were occasionally
accommodated by the state, hence the cycles of centralization-decentralization observed
above, in the nineteenth century, together with other groups and institutions, they were totally
subjugated to the will of the central state (Islamo lu, 1998).25 Consequently, the nineteenth
century centralization was not followed by another cycle of decentralization.
Furthermore, unlike the previous centuries, when centralization was basically
initiated due to the demands of the domestic economy or the state, in this period another
powerful factor was added: pressure from the Western powers. This was, after all, the era of
colonisation and the great powers were determined to impose their own systems on the vast
regions that they colonised. It should also be taken into account that the West had already
attacked its own system of religious charity previously.
The West considered the waqfs as a dead hand or mortmain. The origins of this
hostility has been traced all the way back to the late middle ages when the free towns tried to
control the mortmain and limit the size of the church property. The town councils created
commissions to supervise the charitable foundations.26 Establishment of new charitable
institutions was subject to the approval of these councils. These controls were enhanced
during the reformation when the state officially acquired the powers of supervision. But
Catholic Europe was also going through the same process: a French ordinance of 1543

This view was challenged by al-Nawawi. He shifted the burden of proof on to the
ruler who desired to tax or confiscate waqfs on the ground that it had been usurped
from state owned land. For the details of this legal debate see; Cuno (1982: 77-81).
25
I am grateful to Professor Islamoglu for sharing with me the results of her research
prior to publication.
26
Waqfs are known in the West as charitable foundations or trusts. Generally, the
former is used in the Civil Law countries and the latter in the Common Law countries.
24

51
declared that the royal judges should supervise foundations and organise their administration
if necessary. Another edict issued in 1749 prohibited the founding of new chapters, colleges,
even hospitals without a lettre patent from the king.
The French Revolution constitutes a turning point for the foundations. Eighteenth
century French philosophy legitimised the predominant role assigned to the state. Reference
should be made here to Rousseaus concept of the social contract whereby, as
Montesquieu reformulated, the state has to grant every citizen a livelihood, food and shelter.
This way of thinking, at one stroke, rendered charitable institutions superfluous.
Consequently, in France, in general, any corps intermdiaire, i.e., any independent
organisation, which stood between the individual citizen and the state, was opposed. These
organisations, it was believed, created a fracture in the unity of the nation. No wonder then
that in the 1789 Declaration of the Rights of Man, the civil right of association is missing.
Consequently, a French statute of 1791 dissolved all existing foundations and confiscated
their property. Napoleon took a significant step further and made the Penal Code a more
repressive legislation:
Any association of over twenty persons, whatever their purpose,
cannot be created without the governments agreement and must
respect the conditions imposed by public authorities.
This legislation lasted throughout the nineteenth century, until the 1901 Act. Leaders
of unauthorised associations continued to be punishable and were sued by the repressive
system of the French empire. The developments described above were primarily responsible
for the relatively insignificant role foundations played in France in later periods
(Archambault, 1997(a): 27-29; and 1997 (b):104).
In Germany, Martin Luther was a great advocate of centralised charity. In Prussia,
much affected by France, the Allgemeine Landrecht of 1794 granted supervisory rights to the
state and the question of whether a permanent legal entity such as a charitable foundation
could be organised by the will of a private person was fiercely debated.
In England, monasteries were dissolved and a Rule Against Perpetuities was
promulgated in short, ever since the Edicts of Henry VIII and the Elizabethan Poor Laws, a
secularisation of charitable institutions was advocated and attempted.
The only exception to these developments was the United States where the liberals
insisted that the promotion of public welfare should not be left only to the state. In America
rich individuals were regarded as being under obligation to devote a part of their wealth for
public good and private foundations which served such purposes were regarded as charitable
foundations and were favoured by law (Coing, 1981: 271-82; Friedman, 1973). Germany,
where some foundations did flourish and the concept of subsidiarity was developed, can be
placed between the two extremes: France and the United States.
The overall impact of these developments on the poor in Europe was disastrous. In
France, in the year 1616 the Great Imprisonment took place whereby most of the poor in
Paris were simply imprisoned. Women who were caught begging were publicly flogged and
their heads shaved, while men were taken off to prison.
In Amsterdams poor houses those who refused to work from dawn to dusk were
thrown into special chambers, which would slowly be filled with water from the canals. The
indolent had only one choice if he did not want to drown: to work the pump continuously.
This way, it was thought that indolents would learn the virtue of work (Geremek, 1994).
Thus, it is hardly surprising that a culture, which treated its own poor so harshly, would not
share Islams affectionate attitude towards poverty and therefore regard its charitable
institutions as backward. But different attitudes towards poverty were by no means the
most important factor. More importantly, colonists wanted to acquire land in the countries
that they controlled. Since waqf land could not be sold or acquired, this institution emerged
as the greatest impediment to colonial ambitions.

52

II. Centralization in the Ottoman Empire and Turkey

As we had seen at the beginning of this book vast lands had been transformed into
waqf status in the Ottoman Empire and much of this transformation had occurred despite the
state policy of declaring about 90% of its arable land as state domain. Such transformation
had long been noticed by Ottoman statesmen and indicted as the primary culprit for the poor
performance of the Ottoman armies in the battlefields of Europe.
Koi Bey, a keen observer of the situation at the beginning of the seventeenth
century, argued that certain individuals somehow, acquired state lands as their private
property. These lands had been conquered centuries ago and ought to have remained as
Public Treasury of the Muslims, bayt al-mal. These people were close to the Sultan and
benefiting from their privileged position, had these lands converted into family, ahli waqfs.27
Koi Bey wondered in his report about the legitimacy of such waqfs and suggested to the
sultan that an inspection of all the waqfs founded during the last 200 years be made, the
legitimate ones be maintained while those found to be canonically unsound, be reallocated as
fief, tmar (ztrk, 1995: 248).
Koi Beys report is one of the earliest examples of formal complaints about the
waqf system or more precisely about the abundance of the waqfs. It is noteworthy that only
150 years prior to this report another Ottoman intellectual, A kPashazade, had bitterly
criticised the attempts to abolish some of the waqfs. This difference in the attitudes of the
Ottoman statesmen reflects the universal tendency of the waqf system to expand and any
system, which over expands, invites reaction. This expansion occurred at the expense of the
fiefs, tmar system, with serious military consequences.
Expansion of the waqf lands at the expense of the military fiefs was not the only
reason for the Ottoman states hostility towards the waqfs. We have already mentioned above
the fundamental transformation in the nature of the Ottoman state. Another vitally important
factor emerged with the advent of nationalism. The multitude of nationalities living in the
empire had traditionally been organised into the so-called millet system, with each nation,
millet, enjoying full religious freedom. With European nationalism beginning to make
inroads into the Empire and nationalism beginning to supersede the notion of the Ottoman
commonwealth, the waqf system emerged as an adjunct to the millet system thus perpetuating
the same confessional and national divisions. Consequently, the state began to feel that in
order to restore the integrity of the Empire, the power of the religious authorities, whether
Muslim or Christian, had to be curbed and the Empire by some measures secularised. The
situation was rendered even more serious by the fact that the power of the non-Muslim
religious authorities was enhanced by the support they received from the co-religionist
external powers, with the French supporting the Ottoman Catholics and the Russians the
Ottoman Orthodoxs, etc. Thus emerged what Blaisdell calls the religious protectorate
(1929: ch.9/fn.13). This religious protectorate was soon followed by the financial
protectorate which emerged as the direct result of external borrowing following the Crimean
War. It was the latter which allowed the external powers to meddle directly and dramatically
in waqf affairs. This pressure, strongly felt during the treaties of Paris, London and Berlin,
was expressed bluntly already in 1860 in response to the Ottoman governments request for a
loan after the Crimean War. Among the conditions imposed by the British government were
the following:
a. Foreign citizens should be granted the right to possess state owned lands under the same
conditions as Ottoman subjects.
b. The waqf system should be abolished (ztrk, 1995: 192; Khayat, 1962: 68).

On the legal complications of such conversions see; .L.Barkan, 1944 and

Yediyildiz, 1986: 157.
27

53
This demand was renewed as a combined Anglo-French position in 1867. The
pressure of the financial protectorate reached new heights when in 1881 the Ottoman
government declared its bankruptcy, which led to the establishment of the Public Debt
Administration, Duyn-u Umumiye. To the Ottoman state that was being crushed under
financial pressure as well as by the Western powers, the huge revenue potential, which the
waqfs represented, must have seemed irresistible.28
In 1909 with the dethronement of Sultan Abdulhamid, the policy of balance between
the Western and traditional institutions was abandoned and the scales were tilt in favour of
the former. Under these influences the Ottoman reformers demanded the complete abolition
of the waqfs on the grounds that their wide diffusion crippled the public economy in favour
of family perpetuities. Banners were raised against the waqfs with the slogans of the French
Revolution as if these assets were similar to the position of the wealth of the prerevolutionary Catholic Church (Hatemi, 1996).
Thus, two powerful forces, strangely allied in their hostility to the waqfs, emerged:
Western powers acting within the framework of their own ideology described above and the
Ottoman state which also wanted to revoke the waqfs because they had started to dominate
its lands, tended to intensify the nationalism of its millets and promised a rich source of
revenue to relieve the pressure of the financial protectorate. Western powers initiated their
attack on the waqf system from all fronts: in North Africa and India, as we will see below,
they launched a legal debate targeting particularly the family waqfs while at the same time
they applied pressure on the Ottoman state.
We are now in a position to look at the way the Ottoman state reacted to external
pressures as well as to its own needs. The Ottoman policy can be summarised in one word:
centralization. How this process was actually implemented is well known. The difficulty in
this case is not lack of detailed information but rather to make trustworthy generalisations
from an enormous wealth of data. A brief summary of the basic points will be presented here
but readers interested in these details are referred to the basic two sources (ztrk, 1995;
Barnes, 1987).
While the process of centralization is being discussed, it must be remembered that a
waqf is an institution, which has legal personality. So, subjugating the waqfs under the
jurisdiction of a central authority often involves the violation of this legal personality and an
institution which was intended to be autonomous ends up being subjugated.
In general, the autonomy of the waqfs was respected in the Ottoman empire until
almost the end of the eighteenth century; the state usually did not interfere in the normal
functioning of the waqfs and limited itself to routine inspections through the court system. In
this period Ottoman waqfs functioned as decentralised autonomous institutions according to
the conditions put forward by their founders.
It has been argued that the first attempt at the centralization of the waqf system took
place in the middle of the eighteenth century during Sultan Mustafa IIIs reign and reached a
turning point during Abdulhamid Is reign (Barnes, 1987: 68-73). It was indeed Abdulhamid
I, who paved the way for the foundation of the Ministry of Awqaf, a ministry which reached
to its fullest development under his son Sultan Mahmud II during the nineteenth century.
Thus the father and the son, Abdulhamid I and Mahmud II, played a crucial role in the
centralization of the waqf system.
The establishment of the Ministry of Awqaf, Nezaret, and the centralization of the
waqf management allowed the state to interfere extensively in their affairs. The establishment
of the Nezaret was legitimised on the grounds that the awqaf revenues were left in the hands
of dubious trustees. But, centralization which was supposed to achieve a much better
financial control of the revenues, miserably failed to do so: the Minister of Awqaf, Musa
Safveti Pasha, admitted that despite all his efforts he could not even determine the amount of

The revenue potential was, indeed, huge: it represented 1/4 to of the state budget
during the 18th century (Yediyildiz, 1986: 160).
28

54
the total revenue of the waqfs. His successor Nafiz Pasha also failed to do so (ztrk, 1995:
298). This failure was brought to the attention of the uray Devlet, the Council of State, in
the year 1868 when the entire matter of provincial waqf management was critically
examined. The conclusion reached by the Council amounted to a general indictment against
the administration of the Ministry of Awqaf. But the solution proposed by the Council was as
before and entailed simply further centralization (Barnes, 1987: 150).
Another important aspect of the process of centralization concerns the costs
associated with this process. When the waqfs were being founded in the classical era, since a
centralised management was simply out of the question, no waqf founder had ever considered
taking measures for such expenses. With the establishment of the Nezaret, however,
hundreds of additional bureaucrats had to be financed by the waqfs for which no resources
had been endowed. Moreover, since most awqaf had their own managers, anyway, the
establishment of a central apparatus meant a duplication of expenses and functions with the
consequence that the resources, which should have been utilised for the provision of services,
were spent to finance the salaries of a bureaucratic army.
Furthermore, centralization brought with it a much greater potential for
embezzlement. Since, as we shall see below, collecting the taxes due to the waqfs was a
significant part of the process of centralization, unscrupulous bureaucrats who collected the
waqf funds had all the opportunity to keep these funds for themselves. Indeed, ztrk has
identified 94 such persons in the year 1853. Thus a consequence of the centralization was
that the system was being cheated by the very persons who were supposed to protect and
manage it. For instance, a report by a trustee of an Erzincan waqf dated 1911 reveals that 88
dnms of this waqfs land was confiscated by the Ministry and that some powerful
individuals were the ones who exploited this land for their own use while denying the rights
of the poor.
Another consequence of the centralization was that the waqf system could now be
forced to lend money to the state sector. The total amount owed by the state to the waqf
system reached to 1,737,602 gru in the year 1909 (ztrk, 1995: 313).
Meanwhile, establishment of new waqfs was increasingly made difficult. In the
classical era to establish a waqf was quite easy: the founder only had to go to a local judge
and register his waqf with the court. But in 1863 the state intervened and subjected the
establishment of a waqf to new and more stringent conditions. These conditions effectively
curbed the establishment of new waqfs and those who wished to do good deeds, sawab,
preferred in the nineteenth century to contribute to previously established awqaf.
But the greatest blow to the Ottoman waqf system was dealt in the Tanzimat era,
during the 1830s, thus indicating that the state had already begun to act against the system, on
its own initiative, well before the external pressures had reached a climax in the 1860s. It was
decreed that all the taxes due to the waqfs from the peasantry cultivating waqf lands were to
be collected not by the waqf trustees anymore but by the treasury officials. By the year 1847
this rule was expanded to apply to all the waqfs in the empire without exception.
The importance of this decree lies in the fact that the waqfs were now put at the
mercy of the central authority. From now on, only a percentage of the total waqf revenue
collected would be returned to the waqf system and the magnitude of this was entirely at the
discretion of the state. Moreover, one does not need to have an exceptional imagination to
envisage that this percentage would decline over time. Indeed, regular payments by the state
to the awqaf treasury had already ceased to be paid by 1845 (ztrk, 1995: 285-286). Twenty
years later still the same situation was observed: the instalments to be paid by the Central
Treasury were never paid to the Awqaf Treasury either on time or completely. In short, the
central treasury practically ignored its debts to the waqfs, which led to a constant struggle
between the Awqaf Treasury and the Ministry of Finance, a struggle which the former had
obviously no chance of winning.
Not content with confiscating waqf revenues, the state also forced the waqf system to
be involved in loss making state economic enterprises. The case was that of a yarn factory

55
established by waqf funds in the same year (1826). The yarn factory was to produce yarn for
the uniforms of the new corps as well as the sails of the navy. Since the Ottoman state
applied a policy of purchasing its needs at less than competitive equilibrium prices and did
not protect its investments by imposing import duties against foreign competition, this factory
was doomed to make a loss. It goes without saying that these losses were financed by the
Central Waqf Administration (CWA). Very much the same conditions applied in the case of
another factory producing woollen cloth in Beykoz near Istanbul.
Moreover, the CWA was ordered to construct, together with the municipality, a
tramway line in the Asian side of Istanbul. The CWA ended up supplying both the land for
the construction site of the wagons and financing the lines. The municipality paid nothing.
Finally, a joint-stock company of tramways was founded and the CWA had to purchase
shares worth 468,220 liras. Shares purchased by the public amounted to a mere 22,000 liras.
By the year 1941, it was decided to transfer the ownership of this company to the
Municipality of Istanbul. The transaction occurred with the municipality purchasing the
awqaf shares, worth at least 468,220 liras, by paying only 200,000 liras and even this amount
was to be paid in 15 years time and without interest (ztrk, 1995: 294).
Another revealing case of centralization and deliberate destruction of the waqf
system occurred in the year 1882, when all the revenues of the education related waqfs were
transferred to the Ministry of Education. The transferred revenue was so significant that even
some 30 years later, it still financed 80% of the salaries of the primary school teachers.
Thus, in short, the establishment of the Awqaf- Hmayn Nezareti, Ministry of
Awqaf, and centralization of the awqaf management allowed the state to extensively interfere
in the waqf affairs. The establishment of the Nezaret was legitimised on the grounds that the
waqf revenues were left in the hands of dubious trustees. Some of the trustees, indeed, may
well have been unscrupulous. However, it must be recognised that the harm an individual
trustee may inflict upon a waqf, pales beside what a corrupt high-level official can do to the
entire centralised system.
1. The Turkish Republic
The republic simply continued the process, which had been started by the Ottomans
themselves during the Tanzimat era. This may appear strange, for nearly all the reasons that
prompted the hostility of the Ottoman governments, i.e., provisionism, the diminishing miri
lands due to the constant expansion of waqf lands and intensification of nationalism, had lost
their meaning in this new era. But leaders of the republic continued to be hostile to the waqfs.
This hostility was primarily directed against Islamic brotherhoods but waqfs too came under
the republican fire since the former, it was claimed, were financed by the latter.
The greatest republican destruction appears to have lasted for about a quarter of a
century: from the middle of the 1920s to the 50s. Apparently the idea of destruction was
becoming a popular issue as well, for it is known that during the 1931 general elections many
parliamentary candidates put the abolition of the waqfs at the top of their list of promises. It
is conceivable that those who stood to gain from the sale of waqf properties applauded the
situation. All of this, moreover, was in conformity with the party ideology. It was stated in a
report dated 1939 that this extensive sale of waqf properties was in conformity with the for
the people slogan of the Peoples Party (ztrk, 1995: 430), as if what was being sold off
had not been endowed for the people in the first place.
The process of destruction gained new impetus in 1937 with the establishment of the
Committee for the Abolishment of the Waqfs. Remarkable as it may seem, this committee
was actually established within the CWA. Thus, the CWA aimed at self-destruction! A
selling spree followed and extended to all over the country. Moreover, what could be
described best as a haphazard selling activity appears to have been transformed into a much

56
more systematic policy pursued by the Prime Ministry through the offices of the provincial
governors, general inspectors and the CWA itself.
Once it became clear that bulk of the property of the waqfs was for the taking, the
ministries began to compete for this property. The first claimant, armed with the Law of the
Unity of Education (Tevhid-i Tedrisat Kanunu) dated 1924, was the Ministry of Education.
Meanwhile the Ministry of Interior also demanded these buildings and their plots for its own
needs. The CWA objected to both claims on the grounds that only those waqf buildings
specifically built for schools should be subjected to this Law of Unity, the schools attached to
mosques were primarily religious establishments. The result was total confusion, which led
to contradictory applications.
The confusion is exemplified by the decision taken by the Prime Ministry that only
schools and libraries were to be handed over, tekkes, zawiyas and rent-yielding waqf assets
were to be exempted from the law. Those establishments to be handed over were to be
registered by the Office of Deeds, tapu, under their new owners. Since the Law of the Unity
of Education has rendered all education a primary responsibility of the Ministry of Education,
all the waqf revenues earmarked for educational purposes were to be registered by the
pertinent waqfs and transferred to the Ministry of Education.
These regulations were followed by an even more remarkable one: educational
establishments attached to the mosques, could be claimed by the government offices and if
the waqfs wanted to enjoy the rent revenue of these real estates, they could do so by paying
the government offices the market value of them as determined by the local authorities. This
is a unique decree, which allowed the confiscation of the waqf property without any
compensation in the first place, and then permitted the discriminated- against owner to buy
back at market price what it had owned for centuries. It would be difficult, indeed, to find a
better demonstration of the degree to which the waqf system was subjected to deliberate
destruction.
A very interesting example of how the above law was applied in the provinces is
revealed by the situation in Kastamonu. In 1925 the mufti of Kastamonu officially
complained and informed his superiors that although the law states clearly that medreses
attached to the mosques were not to be sold off, a committee established by the governor of
the city had decided to go ahead with such sales and initiated public auctions. Apparently the
sales were completed notwithstanding his protests. ztrk has found out in 1989 about the
fate of the Kastamonu waqf properties thus sold. The land adjacent to the Nasrullah mosque
was given away to the local Chambers of Commerce; the Abdlbaki Numaniye medrese was
taken over by the Drivers Club; the Nurullah Kad medrese was converted into a parking lot,
the Sddkiye and Ziyaiye medreses were converted into coffee shops, etc., etc., the list gets
longer and longer.
In short, the medreses, the centuries old educational establishments, were sold off
and were, in fact, lost to the cause of education in a massive process of destruction. The
Awqaf Administration initially tried to challenge this process but in the end resigned and
accepted the defeat. Waqf properties were usurped and sold off. In these sales, originally, the
status of the waqf was taken into consideration. But eventually, this situation was contested
by the Ministry of Education, which demanded the right to control all the waqf properties
without regard to the status of the waqf in question, i.e., whether it was mlhak and managed
by its own trustee, or mazbut i.e., managed by the Awqaf Administration (ztrk, 1995: 389,
398).
To summarise, the process of destruction in Turkey followed these steps:
a. The crucial step was the abolition of the financial autonomy of the waqfs through the
declaration that the collection of waqf revenues would be realised by the Ministry of
Finance. This step taken during the Tanzimat era (1830s) left the waqfs completely at the
financial mercy of the Ministry of Finance.
b. The central authority began to usurp increasing proportions of this waqf revenue and the
repayment of the thus collected revenue to the waqfs was delayed as well as curtailed. The

57

c.

d.
e.
f.
g.
h.
i.

outstanding debt of the state to the waqf administration was constantly on the rise.
Complaints by the Minister of Awqaf to the Ministry of Finance produced no results.
While on the one hand its revenues were thus usurped, on the other, the CWA was made
responsible for some of the loss-making state economic enterprises. It was forced to invest
in and manage these enterprises, which were totally unrelated to the waqf system.
Furthermore, the CWA was forced to purchase the shares of some of these enterprises and
then resell these with a drastic discount to the municipalities. Thus, waqf funds originally
endowed by private persons were channelled to state enterprises and to municipal
authorities.
The revenues and assets of all the education related waqfs were transferred to the Ministry
of Education.
The destruction of the waqf system gained further legitimacy through the tatiste and
populist ideology of the republic.
Through the so-called icareteyn system, former tenants were made co-owners of the waqf
property and were strongly induced by the state to purchase the rest of the waqf s assets.
When former tenants failed to buy the waqf assets notwithstanding these inducements,
auctions were organised and the assets (including even some mosques) were simply sold
off to the highest bidder.29
The CWA was made directly responsible for its own dismantlement
The most dramatic republican violation of the legal personality of the waqfs, however,
occurred in 1954 when all the cash waqfs were abolished and with their confiscated
capital, the Bank of the Awqaf (Vakflar Bankas) was financed.

2. Survival and Restoration of Waqfs in Turkey

Something totally unexpected has happened in Turkey and despite everything said
above, the waqfs have survived! We will now focus on these fascinating developments.
A number of factors have contributed to the survival and restoration of the Turkish
waqf system. Foremost among these is the gradual weakening of the Kemalist jacobinisme
and the rise of democracy as well as capitalist accumulation (Bilici, 1993: 420). The 1967
legislation, which allowed the waqfs to breathe again, was submitted to the parliament by
Aydn Bolak, a Member of Parliament.
Interviews conducted with Aydn Bolak and Rahmi Ko have revealed important
hindsight concerning the birth of the 1967 legislation. A visit by the late Vehbi Ko, probably
the greatest businessman Turkey ever produced, to the United States soon after the Second
World War, appears to have been the new beginning (Kra, 1995: 81, 85). Vehbi Ko was
already well aware of the traditional Islamic waqfs. His forefathers had established the
Ibadullah vakf in Ankara and his father had served as the trustee.30 Thus, well acquainted
with the system, he was quick to appreciate the enormous strides made by the American
trusts. The opportunity to observe these trusts functioning arose during business negotiations
with the Ford Motor Company. When he visited a hospital run by the Ford Foundation for a
check-up, he was convinced that the traditional Islamic waqf should be modernised.
By 1951 he began seriously to consider the idea of setting up a philanthropic
foundation along American lines in Turkey. It was at this time that he began to bang his

Actually such sales must have taken place under the Ottomans as well. The
following evidence has been provided by Ipsirli; When in 1889 Ottoman officials
protested about the confiscation of waqf properties in Bulgaria, Bulgarian authorities
responded that the same policy was being applied in Turkey as well (Ip irli, 1989:
684).
30
Twenty-five Years of Philanthropy, 1969-1994 (Istanbul: Vehbi Ko Foundation,
n.d.), p. 6.
29

58
head against the French inspired Civil Law and its extension in waqf affairs, the 1935 Waqf
Law. Soon it became obvious that a modernisation of the waqf system could only be realised
by a completely new law. It was at this time that Vehbi Ko, together with Aydn Bolak,
began a series of meetings with the greatest legal authorities of the country. The problem was
referred to the Institute of Private Law at Ankara University, Faculty of Law, headed first by
Professor Esener, and then Professor Tando an, where the complex legal problems of
combining Islamic traditions with the latest developments in the West were discussed.
One of the most important items to be considered was the tax exemption to be
granted to the waqfs as well as to those who made donations. When the draft bill was
submitted, it encountered fierce resistance. The chief opposition came from Hikmet etin, at
that time a young socialist at the Department of Finance. etin expressed his opposition
succinctly: the philosophy of central planning does not allow any person to perpetuate his
name using revenue due to the state. Notwithstanding such opposition, the reformers
prevailed and the bill became law with full tax exemption granted.
The 13 July 1967 Law (number 903) which was amended several times, introduced
the following:

a. The will prescribed in the foundation document is not changeable.

b. The Civil Tribunal is authorised to register the waqf and to give it a judicial personality.
c. The word establishment, tesis, used exclusively in the Turkish Civil Code, is replaced
by the word vakf (Article 3).

d. No waqf can be created that opposes the law or national interests, support current politics,

a certain race or community.

e. Providing that 80% of their revenues are reserved for public purposes, the waqfs can be
exempted from taxation. This exemption can only be granted by the Council of Ministers
(Articles 4 and 5).
f. The control of these institutions is directly vested with the General Directorate of Waqfs.
g. The annual profit of a waqf is to be added to the original capital of the waqf stated in the
waqf deed and is reported at the beginning of each calendar year to the inspectors (Article
81).
h. A multitude of persons, associations and even the state can create a waqf.
i. A waqf is now allowed to establish a company and allocate the latters total profits, or a
share thereof, to its own specific purpose.
j. Establishment of a waqf has been simplified.
k. Istibdal has been re-introduced (Article 80/a) and is applied subject to the decision of the
court.
Some of these Articles deserve our further attention. Consider first item c where it
is stated that the word tesis is substituted by the word waqf. This Article may appear
bizarre. But such was the hostility of the republican government to the waqfs that it was
prohibited to use even the word vakf in the Turkish Civil Code and the Code of Commerce.
Thus Article c once again legitimises the usage of this ancient term.
Item e rules that providing waqf reserves 80% of its revenue for public services, it
can be tax exempted. The word can is deliberately italicised here, for reservation of 80% of
the revenue does not automatically ensure exemption, which must be approved by the
Council of Ministers, in reality quite a difficult procedure.
Item g restores and breathes life into an age-old practice of the Ottoman waqf
system. The practice of adding the annual profit to the original corpus of the waqf was
observed so meticulously that it can be found in all waqf inspection registers from the
sixteenth to the nineteenth centuries (izaka, 1995).
Items h and i are of such extreme importance for the future development of the
waqf system that we shall comment on them separately below.

59
Item k is also interesting and indicates how modern lawmakers, aware of Islamic
law, can re-introduce ancient Islamic principles in a far more direct and simple way. Indeed,
as we have explained above in considerable detail, istibdal was a highly controversial issue
among the classical Muslim jurists. Yet, the modern jurists who drafted the 1967 Law,
circumvented these controversies and simply reintroduced this institution without any
reference to the huge historical controversy. Article 80/A is very simple and can be translated
as follows:
properties of a waqf whose income does not suffice to meet its expenditure,
or in case these properties do not yield revenue commensurate to their real value,
may be exchanged with another more beneficial property (istibdal) or with cash
(ibdal) .31
Returning now to the items h and i above, the idea to enable a waqf to establish
its own company was actually clearly pronounced already in 1963 (Ballar, 2000: 663). In the
1967 Law the idea is repeated and confirmed in a highly cryptic style. Item 5 B/6 merely
states that the net profit of a company, kurum, is paid to the tax exempted waqfs, in
proportion to their contribution to its capital. Ambiguities have been eliminated by a decree
published by the Ministry of Finance in the Official Gazette dated July 28, 1994. In the
preamble of the decree it is stated offhandedly that the tax exemption granted to the waqfs is
not granted to the companies that the former may establish, thus confirming that a company
or companies can be established by a waqf.32 It is further clarified in Article V/3 that these
waqf companies are subject to taxation and their accounts are to be kept separately from their
waqf-founders. After these companies pay their taxes according to the prevailing tax law,
their net profit is to be transferred to the founder-waqf (Yener, 1995: 249, 259-60). The
previously stated Article 5B/6 of the 1967 Law, on the other hand, makes it clear that in case
a company has been created by a multitude of waqfs, then its profits will be distributed to
these waqfs in proportion to their original contribution to the companys capital.
An infringement was introduced with the Corporation Tax Law No. 199 on the
donations by outside companies, i.e., those not established by a waqf. The Law No. 199
limited donations to the tax-exempt waqfs by outside companies to a mere 5% of the latters
profits. (Ballar, 2000: 461, 464). In the United States, by contrast, the charitable
contribution deduction for a corporation is limited to 10% of the corporations pre-tax
net income. For an individual the same ratio is as much as 50% (Salamon and Toepler,
1997).
To sum up, through a series of laws and decrees promulgated in 1963, 1967 and 1994
a vitally important process, supply side capital pooling among the waqfs, has been permitted.
The reader will notice that we had referred to supply side capital pooling for the first time
above when we were discussing the Ottoman cash waqfs. It will be recalled that these had
pooled their resources and allocated a part of their annual profits to certain other waqfs. What
Article 5B/6 has provided for is the modern version of this historical process.
The modern capital pooling differs from the historical one in the following:
a. Whereas the historical process was practised among several cash waqfs, the modern one is
practised with several waqfs purchasing (i tirak) the shares of a company.
b. Although in historical capital pooling the contributed capital
was simply absorbed
by the receiving waqf and never returned, in the modern one, since the receiving party, the
company itself, is capable of regularly generating a profit, it returns a share thereof to its
owners; the waqf(s).

Italics are mine.

In the original 1967 Law, profits of the companies attached to the waqfs were tax
exempt. Thus this 1994 decree is actually an infringement.
31

32

60
All in all, businesses owned by waqfs are subject to the following general rules: they
do not have separate legal status and are considered merely as units internal to the founding
waqf; tax-exempt waqfs are not considered to be businesses because they are in possession of
profit making enterprises, but waqfs that are not tax-exempt are considered to be businesses
if they possess profit making enterprises (Ballar, 2000: 990).
To all this we need to add that companies also are authorised to establish their own
waqfs. This is despite the fact that the pertinent Articles of the Turkish Civil Law (Articles 73
and 74) are silent on this issue. The authorisation is therefore based upon some general views
expressed in Article 137 of the Turkish Trade Law. There is also a precedence; a waqf
established by the mighty Bank (Ballar, 2000: 28-29).
Thus we have a situation whereby a waqf(s) creating its own company as well as a
company creating its own waqf(s). In the former case, a waqf or waqfs pool their resources
and create a company or companies. They also get a relative share of the profits according to
their capital contribution. In the latter case, a waqf or waqfs are created by a company, which
allocates a share of its profits voluntarily to these. The Diyanet Vakf constitutes an example
of a waqf creating a multitude of companies or providing equity finance to already
established companies,33 while the Vehbi Ko Foundation is the best example of a huge
conglomerate creating its own waqf.34 The Vehbi Ko Foundation specialises in education
and has financed a highly ambitious school and a major university, while the Diyanet, like
the Tabung Haji of Malaysia, is involved in the organisation of the annual pilgrimage to
Mecca and is represented in 700 localities by 90.000 religious functionaries!
The importance of these innovations cannot be emphasised enough. This is because,
for the first time in the centuries long history of waqfs, we have this institution at last
provided with the means to benefit from the dynamism of companies. It will be recalled that
notwithstanding Imam Zufars prescription that cash waqfs should invest their capital
through mudaraba, Ottoman cash waqfs had invested their capital by providing interest
bearing loans, istiglal. Consequently, their income was limited to the economic interest that
they had charged which always fell behind the market interest rate. In short, risk averseness
of the founders and the trustees had condemned Ottoman cash waqfs to inertia. In the post
1967 Turkish Republic, however, waqfs have become direct recipients of companies realised
profits. Thus, ironically, it is not the waqfs of Ottoman but rather of the staunchly secular
Republican Turkey that effected, at long last, Imam Zufars teaching.35

According to Diyanet Vakfi, Faaliyet Raporu (Ankara: Trkiye Diyanet Vakfi,

1997), pp. 109-119, this waqf had established six different companies and owned 8099% of their equities. It also purchased the shares of various Islamic banks (KuveytTrk Evkaf Kurumu and Ihlas Finans) and insurance companies. Such shares
constituted 1-10% of the total net asset value of these companies.
34
The waqf-company linkages are cemented at the Ko conglomerate by an exchange
of executive officers: two persons appointed by the holding sit at the Executive Board
of the Vehbi Ko Foundation and two persons appointed by the latter sit at the
Executive Board of the holding. In addition to these two persons appointed by the
holding, the following persons sit at the Board of Directors of the Ko Foundation:
four family members, the CEO of the holding, two professors (one jurist), and the
General Manager of I Bank.
35
On the near identity of equity finance and the historical mudaraba see; (izaka,
1996). This is not to say, however, that the modern Turkish cash waqfs completely
operate through equity finance. They also purchase bonds and receive interest
disregarding the Islamic prohibition. Actually, interest constitutes a major source of
income. So much so that interest income diluted by inflation has been a cause of
concern and the GDW has been urged to calculate and announce the real interest rate,
i.e., nominal interest rate minus inflation (Ballar, 2000: 41).
33

61
Moreover, we can also interpret these waqf-company relations as the rebirth of cash
waqfs.36 Thus, Ottoman cash waqfs destroyed in 1954 by being incorporated into the bank of
waqfs, Vakflar Bankas, have, like a phoenix, been reborn albeit in a radically different
organisational structure and in a far more dynamic form. A recent decision declared by the
General Directorate of Waqfs (GDW) on August 6th, 1999 has carried this process even
further. The directorate has now permitted the waqfs to purchase shares of a company not
even yet traded in the stock exchange. Purchasing such shares, moreover, has been left
entirely to the discretion of the waqf managers. Reselling such shares, however, is more
difficult and involves a complex procedure. This latest decision is an exciting development,
which may pave the way for cash waqf-venture capital (mudaraba) linkages (izaka, 1998:
60-67).
The following excerpt dictated by the late Vehbi Ko, himself, in January 1969 and
taken from the Deed of Trust of his foundation, The Vehbi Ko Foundation, explains why he
had decided to establish his foundation as a cash waqf:
Praise be to Almighty God, who with His Will enabled me to perform charitable
works during my lifetime with pleasure, and granted me the means to continue
performing ongoing charity after my death. In my belief that the Turkish Nation will
continue to exist so long as the world endures and my wish being to establish this
foundation in perpetuity, I have based this endowment on a commercial entity that
will be able to adapt itself to the requirements of the day rather than on properties
dependant on economic conditions and natural disasters. I have chosen to set up this
endowment with the shares of Ko Holding. These are made up of numerous
commercial and industrial enterprises, and are therefore less subject to risks. This
foundation that I have established by the Grace and Kindness of God, I entrust, first
of all, to my heirs and to their succeeding generations, to my business colleagues and
to the Government of the Republic of Turkey. I call upon all my heirs, my close
acquaintances, my business colleagues, my fellow citizens who may be involved in
this Foundation, and the officials who will assume its administration, to accept this
endowment as a bequest made to the Turkish Nation, to protect it, and strive with
their best intention to achieve its original aims. I request the auditing authorities of
the State and, when necessary, its authorised agencies, courts and judiciary, never to
depart from the dictates of their conscience when making decisions, lest this
foundation suffers harm and be diverted from its aims. I have brought this enterprise
into being as a result of lifetime effort and sincere desire. I pray that God will regard
it worthy of His Protection and grant it success. 37
The late Vehbi Kos personal statement reveals a number of important points on
which we would like to comment. First, there is a deep sense of religiosity and gratitude to
the Almighty for allowing him to continue being charitable even after his death. In other
words, an awareness of the importance of sadaqa jariya and the Prophetic tradition
mentioned at the beginning of this book. After this, he makes this endowment in perpetuity.
This is followed by an explanation of why he has decided to organise his endowment
as a cash waqf rather than a real estate one. His decision was based on the concern that real

Indeed, consider the following rulings of the Yargitay: The corpus of a waqf can be
any economic asset and A waqf cannot be established unless cash has been
deposited into its bank account . Yargitay 18. Hukuk Dairesi, E. 1996/ 9020, K,
1996/ 9680, T. 5. 11. 1996 and E. 1996/ 11548, K. 1997/ 205, T. 21. 01. 1997.
37
The Vehbi Ko Foundation, Twenty-five Years of Philanthropy, 1969-1994
(Istanbul: The Vehbi Ko Foundation, 1995), p. 1. I am grateful to my sister,
Professor Dr. igdem Kgitibasi, for sending me this important document from
Istanbul. Italics are mine.
36

62
estate waqfs may be vulnerable to economic conjuncture and natural disasters. Since the
shares of his own holding are made up of numerous commercial and industrial estates, they
are less subject to risks. Here we observe a profound understanding of the way a waqf
functions. Vehbi Ko seems to have been fully aware of the vulnerability of real estate waqfs
to economic conjuncture. Such vulnerability has been demonstrated by Suraiya Faroqhi using
the seventeenth century records of Mahmut Pasha Vakf (1995: 281-84).
Although there is no evidence as to how the Vehbi Ko Foundation would fare under
similar conditions, theoretically, it may be argued that a conglomerate capable of penetrating
into international markets should be better equipped in dealing with stagnation by
diversifying its markets. Indeed, there are more than 100 companies in the Ko conglomerate
with 40,000 employees and the total number of Ko Holding shares allocated to the
foundation has been declared as 10,000.38 These registered shares each with a nominal value
of ten million TLs, constitute 9.4 % of the total assets of the Ko conglomerate. In this way,
the late Vehbi Ko has diversified the risks.
But, it should be noted that second generation members of the Ko family have
continued to expand generously the assets of the foundation with further donations of their
own. These individuals have donated a total of twenty-one funds. Consequently, the original
10.000 shares endowed by the late Vehbi Ko constitute now a mere 1.4% of the total assets
of the foundation in book value. At the end of 1993 the book value of the foundations assets
stood at $ 120 million with an approximate market value of $ 297 million. These increased to
$ 187 million and $ 762 million respectively, primarily due to the superb performance of the
Istanbul Stock Exchange in 1999.
The foundation is entrusted first, to the coming generations of his heirs, thus, this is
essentially a family waqf in perpetuity,39 and then to the business colleagues and then to the
future governments of Turkey. The business colleagues were probably included with the view
that if the heirs prove to be incapable individuals, the colleagues who run the Ko enterprises
should interfere and manage the waqf with proper business perspective. Their inclusion in the
deed would certainly enable them to have a say in the waqf affairs. Inclusion of the
government is also telling: Vehbi Ko had been an eyewitness to the great destruction of the
Turkish waqfs by the state that took place between the 1930s and 50s. Perhaps, by entrusting
his endowment to the future governments of Turkey, he wanted to impose a moral obligation
to the state. Finally, he feels the need for the prayer that God will regard it worthy of His
Protection!
We are given further important information pertaining to the investment of the
foundation shares in the waqf deed. Article 7 of the Vehbi Ko Foundation Deed stipulates
that all excess cash of the foundation that accrues to the waqf on an annual basis shall be
converted into government bonds and kept as an emergency fund. These bonds shall be used

Vehbi Ko Vakfi Resm Senedi, Article 4, p. 5. Rahmi Ko has informed this author
that his father one day summoned his children and asked them if they have any
objection to the allocation of these shares to the Vehbi Ko Foundation. When they
replied negatively, a notary public who was present collected their signatures. In this
way Vehbi Ko prevented any potential second generation litigation in the future.
39
Although its endowment deed (Article No. 17) provides a minimum income (six
million liras p.a. adjusted for inflation) to the future generations of the Ko family in
case they need it, the Vehbi Ko Vakfi is only theoretically a family waqf. Its primary
focus is charity and provision for the family is insignificant. Traditional family waqfs,
which focus entirely on the provision for the family, though perfectly legitimate as far
as the classical Islamic juriprudence is concerned, are prohibited by Article 322 of the
Turkish Civil Law. This prohibition, a clear Western influence, is now seriously
challenged for undermining the institution of family. Search for modernised family
waqfs has started (Ballar, 2000: 310, 771-776).
38

63
when the Ko Holding exercises a capital enhancement. Should this process take place, the
foundation shall participate therein, so as to maintain its relative share in the conglomerate.
Should the emergency fund not suffice to maintain the foundations share in the
conglomerate, the Board of Trustees can allocate 20% of the primary revenue of the waqf for
this purpose. Should a process of capital enhancement not take place, the excess cash of the
fund shall be invested in shares and bonds, preferably those of Ko Holding companies. We
are informed, furthermore, that the waqf can also exercise istibdal subject to the approval of
the Board of Trustees and the Court (Article 8).
Article 9 stipulates that a minimum of 80% of the total revenue of the waqf shall be
allocated to social and cultural services. A maximum of 20% of the revenue shall be allocated
to administrative expenses, emergency cash, and investments to buy properties for the waqf.
It is well known that in history the trustees often usurped waqf revenues allocated for charity.
Consequently, while in history charity/total expenditure ratio of waqfs has often declined,
salary/total expenditure ratio has often either remained the same or increased at the expense
of the former (Faroqhi, 1995: 285). Vehbi Ko seems to have been either aware of these
historical tendencies or was able to envisage them thanks to his great business acumen. It is
also possible that he may have been simply remaining within the boundaries set by item e
of the 1967 Law in order to qualify for tax exemption, in which case the credit for this insight
should go to the drafters of the law.
Finally, we are informed that the Vehbi Ko Foundation was granted tax-exempt
status by the Council of Ministers on 28 December 1968. Thus, Turkey owes to Vehbi Ko,
Aydn Bolak and to the brilliant jurists who helped them not only the great Ko endowment
but also all the positive developments that took place in the waqf system after 1967.
A closer look into the balance sheet of another powerful foundation, the Diyanet
Vakf, confirms this newfound dynamism of the modern Turkish waqfs: in the year 1995, the
total value of investment in the equity of affiliated companies constituted 5% of the total
value of assets. The following year, this ratio nearly tripled and reached 14%. If we look
directly into the investments in companies, we are informed that such investments increased
by 960% between 1994-1995 and 664% between 1995-1996. In passing, it might be noted
that in 1996 the total value of assets of this waqf was approximately equal to 94 million US
dollars.40
The reader may wonder about the actual impact of these innovations introduced by
the Law No. 903 on the Turkish waqf system in 1967. Nothing illustrates this impact better
then the actual number of waqfs endowed. From the beginning of the Republic in 1923 to
1967 when the new law was promulgated, a time span of 44 years, a mere 73 new waqfs had
been established, whereas from 1967 until 1985, a time span of 18 years, one observes 1877
new waqfs. From 1986 to 1996 more than one hundred waqfs were established annually with
the trend rising until it reached 439 new waqfs in 1996, a maximum (Aydn, Sa lam and
et.all, 1999: 34).
Defining the new waqfs as those established after the 1967 Law, the number of
these waqfs has been calculated as more than 4,000 (Bker, Aydn, Sa lam, 1998: 4 and
Aydn, Sa lam and et. all, 1999: 33, 34).
One of the most significant contributions of the 1967 Law has been observed in the
field of education. By 1998, altogether 16 waqf universities had been established. Some of
these already enjoy an excellent reputation and are considered among the top universities of
the country.
The new republican waqfs are also playing a key role in a major historical
development. The Kemalist Revolution had created a territorial nationalism and had oriented
itself entirely towards Europe to the total exclusion of Islam and the potential link with the
Turkic world of Central Asia. All activities in the latter were suspect and repressed by the
state. Since the Second World War, the links between Turkey and the Central Asian Turkic
40

Trk Diyanet Vakfi, Faaliyet Raporu, Blm II and p. 163.

64
World had totally disappeared due to the Soviet sphere of influence, which had clearly
demarcated the West from the Communist world. The good neighbourly relations between
Turkey and the Soviet Union also severed links between the Turkic peoples.
After the 1980 military take-over, a group of pan-Turkist associations had
transformed themselves into waqfs. Meanwhile, the structural changes in the Soviet Union
have provided these institutions a heaven-sent opportunity to shift from passivity into activity
in the field. With the establishment of the Anavatan Party in 1983 they were also provided
with official state support. Certain ministries stemming from the pan-Turkist party of
National Movement are now applying their ideology through the waqfs. These waqfs are now
involved in researching the culture of Turkic peoples in Eastern Trkistan (West China),
Crimea, Greece, Uzbekistan, Dagestan and Iraq. It is indicative of the support these waqfs are
receiving from the state that the Waqf for the Voice of Eastern Trkistan has been granted, by
the GDW the majestic mosque of Damat Ibrahim and its medrese in the heart of Istanbul as
their centre of research.
The powerful Trkiye Diyanet Vakfi, mentioned above, was founded in 1975
originally to provide finance to religious personnel and to promote Islam throughout Turkey.
Gradually, it began to reorient itself more and more towards external Turks. This
reorientation was made possible by an amendment to the waqfs endowment deed on
September 13, 1993, which can be translated as follows:
The waqf endeavours to contribute to the enhancement of the religious and cultural
life of our kin and fellow Muslims abroad. It also provides financial support to individuals
and institutions in this area. For this purpose, it builds mosques, cultural and Quran reading
centres and grants scholarships to students from these countries.41
The waqf is known to have established printing houses in various Turkic capitals in
Central Asia to print books in modern Turkish to unify the alphabet, to print and distribute
the Quran and to provide thousands of scholarships to students (Turks from Turkey to the
former Soviet Union and external Turks from there to Turkish universities so as to enhance
linguistic unity and social understanding) (Bilici, 1992: 21).
Other late developments in the waqf system of the Turkish Republic may be
summarised as follows: under the Republic, the GDW took over all the duties of the Ottoman
Ministry of Awqaf. Article 77 of the Civil Law of Turkey maintains that a waqf must have a
management board. Other organs such as auditing and shareholders assembly are left to
discretion. The founder himself may be the director. Inspections are made to ensure the waqf
conforms to the original purpose and an audit is done at least once every two years.
The Directorate takes 5% from the net incomes of all awqaf as supervision and
auditing fees. There used to be an upper limit to this amount. But in 1992, it was removed in
order to allow for the high rates of inflation. Moreover, should a waqf have branches in
various towns, each branch is now obliged to pay this 5% (Ballar, 2000: 171). Implications of
the change made in 1992 should be obvious: unless a waqf serving in a multitude of cities is
prepared to pay a big chunk of its overall income to the directorate, it will simply be forced to
scale down its activities. It is difficult to imagine a ruling more detrimental to the wide spread
provision of charity.
The GDW operates under the Prime Minister. At the top there is the Awqaf
Executive Board as appointed by the Prime Minister, then comes the General Director. There
are 28 regional and municipal administrators. The Directorate has the right to invest its
income in various sectors. For instance, it has a 55% share in the Sheraton Hotel in Istanbul.
The Vakflar Bankas established by the pooling of the capital of all the Ottoman cash waqfs,
as mentioned above, is the biggest bank in Turkey with a capital of 45 million US dollars and

Trkiye Diyanet Vakfi, Faaliyet Raporu, 1995-1997 (Ankara: Trkiye Diyanet

Vakfi, 1997), Vakif Senedinde Yapilan Degisiklikler.
41

65
has 300 branches all over the country. The bank generated a profit of $5 million in 1983.
These profits are expected to be spent for the needs of the waqf properties. A matter of
considerable inconvenience for the waqfs is the obligation that they must deposit their cash
incomes either with the state banks or with the Vakflar Bankas, despite the fact that these
banks pay a lower interest than the private banks. Since all deposits in all banks are
guaranteed by the state, this obligation has been the object of bitter and justified complaints.
The properties managed by the GDW that have survived from the Ottoman era are
distributed as follows:
Table 1: Waqf Properties in Turkey
Mosques
Dormitories
Business centres
Hotels/caravansaries
Shops
Apartments
Other properties
Total
Source: IRTI/IDB, 1987: 116-117.

4,400
500
453
150
5,348
2,254
24,809
37,917

Thus these figures do not include the properties of awqaf established after the Republic in
1923. All the awqaf registered with the GDW must supply the following information:
a. Founder(s)
b. Aims
c. Capital
d. Sources of income
e. The administrative organ
f. An assessment of the principles on the allocation of the waqf properties in the event of the
liquidation of the waqf
All the waqfs in Turkey are divided into 3 groups according to their dates of
establishment:
a. Those inherited from the Ottoman and Seluk Empires
b. New waqfs established during the Republican Era under the provisions of Law No. 903
c. Those managed by the GDW
They are also classified into the following groups according to management criteria:
a. Mazbut Vakflar: These are managed by the GDW, which also appoints their trustees. Each
one of these waqfs has legal personality
b. Mlhak Vakflar: These are managed by their own board of trustees and each one
possesses legal personality. They have their own obligations, sources of income, and pay
their own debts. These are divided into 3 further types. The majority are waqfs managed by
the children of their founders; then there are the newly established waqfs, which are subject
to Law No. 903, and finally, the waqfs of the minorities.
Tax liabilities of the awqaf are determined by tax inspectors on the basis of all legal
records and book keeping. Waqf properties are supposed to be exempt from corporate tax,
income tax, expenditure tax, property purchase tax, stamp duty, customs duty and inheritance
tax subject to the conditions mentioned above. But in reality, the Finance Ministry grants taxexempt status only very rarely (Saygn, 1998). This is attested by Aydn and Sa lam (1999:
33, 60); out of more than 4,000 new waqfs established during the Republican era, a mere 195
have been granted tax-exempt status.
A new Act was passed in 1983, which readjusted waqf property rents taking into
consideration the prevailing inflation. The importance of this Act will be better appreciated
when we examine the Malaysian waqfs below.

66
Unlike some branches of Islamic law, which emphasize the irrevocability of the
waqfs, the secular 1967 Law allows a waqf to be liquidated. If the Board of Trustees is
convinced that the purpose of the waqf can no longer be fulfilled, it can apply to the GDW
and after getting approval, can apply to the courts for liquidation. The assets of the liquidated
waqf are returned to the individuals named in the waqf deed. If there is no such statement in
the deed, then the principle of cy pres is applied and the assets are allocated by the GDW to
another waqf, which has similar goals. A waqf can also be liquidated by the state if its
purpose is considered harmful. These harmful activities leading to the closure of a waqf are
clearly stated in Article 74 of the 1967 Law. A waqf liquidating itself due to economic
hardships, or being liquidated by the state due to the Article 74, are the only ways a waqf can
be terminated.
Recent events in Turkey indicate that despite the positive developments described
above, the age-old conflict between the state and the waqfs continues unabated. The
explosion in the number of new waqfs has triggered, not surprisingly, a reaction. The
National Security Council (NSC) has decided to have a bill drafted empowering the Ministry
of Interior Affairs to close down any waqf, which deviates from its original purpose stated in
its deed. The reaction of the Council is based upon reports that some new waqfs have been
engaged in fundamentalist activities.
When questioned by the NSC why his office does not control such activities, the
General Director of the Waqfs reiterated that he has 59 inspectors to control about 10,000
waqfs. In any case, it is interesting that the NSC has not demanded a complete destruction of
the waqfs, as was the case during the early days of the Republic. Whilst this possibility still
exists, the fact that the Council has exercised caution and demanded the closure of only those
waqfs involved in fundamentalist and separatist activities, indicates that the generals have
begun to appreciate the advantages that the waqfs can provide. It is possible that they may
have been persuaded in this by the very waqfs they, themselves, have established. Three of
these are among the top tax-exempt waqfs. The total assets of these, including the Waqf to
Support the Police, reached a staggering figure of 22,000 billion TLs. in 1996, an amount
twice as large as the assets of the largest waqf in the country, the Vehbi Ko Foundation
(Aydn and Sa lam, 1999: 61).
One of these three, the Waqf for the Promotion of the Turkish Armed Forces
(WPTAF) is a waqf complex. Originally there was a waqf for each branch of the armed
forces. After much dispute and in violation of the traditional waqf law, these waqfs were
merged into one (Ballar, 2000: 533). The need for such waqfs emerged when the navy was
desperate for amphibious vehicles for the planned invasion of Cyprus. Since NATO refused
to provide these vessels, they had to be domestically procured. The WPTAF and its early
versions mobilised the entire nation, which donated the funds needed for such equipment.
Actually, mobilising the nation for military needs is not new in Turkey. Earlier
examples had been observed shortly before the First World War and during the construction
of the Hejaz Railway. The latter was particularly remarkable in that not only Turks but also
nearly the whole Islamic world donated (Usul, 1999).
A fascinating latest development in Turkey concerns the embracing of the waqf
system by the secularists. A secularist group, which calls itself the Third Sector Foundation,
TSEV and headed by the Ko and Sabanc families who have both established their own
waqf universities, has emerged as an umbrella organisation representing seven hundred waqfs
(Ballar, 2000: 925). TSEV argues that
in a society where there is no third sector organised by independent citizens, human
rights and public welfare are doomed to remain under the supremacy of the first
(public) and second (private) sectors (Balo lu, 1996: 10).
This is, indeed, a fascinating development as it reveals the importance of the waqf
system in yet another vitally important area: human rights. But waqfs can just as easily be

67
used in order to curb human rights. Indeed, during the last decade of the twentieth century an
unfortunate development has occurred. This is the involvement of certain waqfs in
fundamentalist activities. Convinced that some waqfs provide finance to such activities, the
NSC responded by returning to the traditional negative position. As a result, tax exemption
privileges previously granted under the 1967 Law, have been abolished one by one and the
donations to the waqfs are limited.
This negative policy culminated in the preparation of a draft bill in 1998 prepared by
the Ministry of Justice, which aimed to re-write the entire Turkish Civil Code. The draft
contains important infringements of waqf rights. To start with, it introduces the concept of
sufficiency to establish a waqf: it is not anymore enough to allocate a property or cash as
corpus. It is now required that this corpus should be sufficient for the purpose of the waqf
with sufficiency being determined by the authorities in Ankara. More importantly, the draft
authorises the Ministry of Interior to temporarily close down a waqf suspected of violating
the law even without waiting for the final decision of the courts (Ballar, 2000: 1383-1391).
These innovations, however, have been hotly contested by TSEV, which initiated many
court cases. When these litigations did not yield any concrete results, TSEV appealed to the
President of the Republic, Mr. Demirel. He reviewed the two bills abolishing the taxexemptions enjoyed by waqfs, and returned them to the Prime Ministry with the suggestion
that the tax-exemptions should be maintained and the 5% limitation imposed on donations be
abolished (Balo lu, 2000: 16-17). The President has also been asked to veto the 1998 draft
bill in toto.
Thus, for the first time in the long history of this institution, a waqf representing
seven hundred others,42 has staged a challenge to those aiming to undermine the system in
Turkey. These efforts, so far, have yielded mixed results: although the idea of subjecting the
donations to taxation has not yet been abandoned, the rate of taxation applied in 1999 was
zero percent (Ballar, 2000: 11, 925). Notwithstanding these mixed results, a powerful waqf
representing hundreds of others, appears to be a more promising arrangement for defending
the rights of the waqfs than traditional centralised organs, such as the CWA or the GDW,
pretending to represent the waqfs but in fact totally subjugated to the whims of the state.
In conclusion; the extreme modernist view that a waqf is a purely religious institution totally
unsuitable for modern life and therefore should either be eliminated or be completely
decontaminated from its religious characteristics has been abandoned. If so, the credit for
this should go to the designers of the 1967 Law. For, it was with this law that waqfs
originating from the earliest teachings of Islam were incorporated into the secular Turkish
Civil Law.
III. Egypt
As we have seen above, the Fatimid Egypt under Caliph Al-Muizz probably
witnessed the very first centralization attempt of the waqf system in Islamic history. But we
have also seen that these attempts were thwarted by Salahaddin Ayyubid and a cyclical
process of centralization to be followed by decentralization ensued.43 Makrizi informs us that
in Egypt arable land could be originally endowed. But the Fatimids prohibited the
endowment of land and subjected the co-ordination and inspection of the waqfs to an office
called Divan al-Ahbas. This prohibition was probably due to the provisionist concerns, much
like the Roman policy mentioned above. By the late Fatimid period, however, the prohibition
became ineffective and the conversion of significant amounts of land into waqf began and
continued under the Ayyubids and Mamluks (Cuno, 1982: 21).

The last TSEV convention was attended by about 700 waqf representatives. But
the number of actual fee paying members is about 100.
43
For the details of Salahaddins waqf policy in Egypt and Palestine see; (Frenkel,
1999).
42

68

1. Egyptian Waqfs Under the Mamluks:

The Egyptian awqaf under the Mamluks constituted 2/7th of the total cultivable land
in the country (Yediyldz, 1986: 159). These waqf lands have been categorised into three
groups.
a. Ahbas al-mebrure: These were the great endowments of Egypt and were controlled
by the devadar. A huge amount of land was assigned for these awqaf, which amounted to
130,000 feddan in the year 740 A.H.. Makrizi informs us with regret how these waqfs had
stagnated due to the corruption of the officials. Many parasitical individuals were given high
salaries for doing pious work in mosques some of which did not even have a community.
Half of the revenue was also claimed and collected by the Sultans treasury.
b. Awqaf al-Hukmiye: The revenue of these waqfs was assigned to the holy cities,
haremeyn, and to the freeing (purchasing) of Muslim slaves from Christians. Makrizi had
reported enormous corruption related to these awqaf. Accordingly, since the beginning of the
ninth century (A.H.) these waqfs were in a terrible state. Istibdal was applied extensively and
could easily be concluded with a few witnesses.
c. Awqaf al-ahli: These were the family waqfs. In Egypt and Syria they controlled
vast lands, which were originally owned by the state, i.e., these lands were usurped by the
emirs who endowed them subsequently as if they had always been private property. As will
be recalled from above, such waqfs are called awqaf al-gayri sahiha. Sultan Barkuk wanted
to take over these, but faced by strong opposition from the ulema, had to give up. Beginning
with Barkuk, many subsequent rulers took over these awqaf by paying one-tenth of the
revenue to the descendants of the founders. Another method of usurpation applied by Barkuk
was to have his officials lease such waqf properties at less than market rates and then rent
them to third persons at realistic prices with the difference accruing to the ruler (Abuzahra,
1972: 11). From the middle of the seventh century to the Ottoman era, there were at least six
attempts by various rulers to usurp and nationalize waqf revenues. Such attempts were mostly
unsuccessful as they were always opposed by the ulema and fiercely resisted (Yediyldz,
1986: 161).
In the Mamluk state another unfair treatment against the waqfs occurred by imposing
upon them not only the kharaj and ushr taxes which were essentially shari taxes, but also
subjecting them to all sorts of urfi taxes. Such irregularities, however, were by no means
limited to Egypt and were observed in huge areas of the Muslim world: Egypt, Iran, Iraq and
Anatolia. Another very common sort of corruption practised by the trustees was to keep part
of the revenue and not to pay it to the descendants of the founder, or even worse, to commit
istibdal without getting anything in return.
Although frequent warfare among the various Islamic states, and change of dynasties
within one state, naturally, led to a considerable deterioration in the position of the awqaf, it
can be argued that, in the long run, the general well-being of the waqf system did not change
much. The traditionalism of the medieval Muslim states saw to it that after the initial impact
of the conquest faded away, the old order was re-established and the waqfs were restored. In
this context land ownership, the relative position of the social classes, tax system, and the
administrative machinery remained very much the same and the old laws and customs
continued. Thus the waqf administration and inspection system remained within the same
general framework originally designed by the Abbasids and the Samanids (Kprl, 1942:
19).
2. Egyptian Waqfs Under the Ottomans
Incorporation of Egypt into the Ottoman Empire in the year 922/1517 also did not
change this overall picture in a radical way. The Ottoman conquest was not the first
encounter between the Turks and Egyptians, for the Egyptians had been accustomed to the

69
presence of Turks or Turkish-speaking people since the ninth century, when Egypt was ruled
by the dynasty of Ibn Tulun, who was a Turk. Therefore the Ottoman conquest would not
have involved much of a cultural shock. Moreover, the document of appointment, berat,
issued to the newly appointed Ottoman governor, Beylerbeyi, of Egypt ordered him to govern
in accordance to the prevailing system of law, the Shariah. It has been argued that 85% of
the body of law prevailing in Ottoman Egypt was constituted by the Shariah and only the
other 15% pertained to administrative and military matters as well as to the local custom
(Akgndz, 1993, vols. VI-VII: 63). This is another factor, which explains the continuity
mentioned above. The following points concerning waqf matters were included in the
Kanunname issued by Ibrahim Pasha who had left Istanbul for Egypt in the month of
Zilhicce, 930/1524:
a. Assistants to the new governor are to visit the trustee of each waqf and demand
from him the endowment deed.
b. They are to inspect the revenue and expenditure of each waqf and identify the
beneficiaries. They will pay particular attention if these expenses are made in
conformity with the original document of endowment.
c. Those trustees found to have managed their waqfs according to the original
document of endowment, vakfname, are to be re- authorised and be allowed to
continue managing their waqfs. Those who fail these inspections are to be fired
from their positions.
d. They will also observe the state of the waqf property. If these properties are found
to be in need of repairs, they shall try to have them repaired. If the waqf is found
to generate more revenue than its expenditure, such repairs are to be carried out
immediately. Where expenditure exceeds revenues, repairs should be carried
through by cutting down a certain percentage of the expenditure. If repairs cannot
be financed by such partial remedies, then with the exception of the absolute
necessities, all other expenditure should be minimised and all the resources of the
waqf should be mobilised for repairs.
e. After the inspection, a ledger is to be prepared and bound. This ledger is to
contain detailed and summary information about all the revenues and expenditure
as well as the number of employees and beneficiaries. Two copies of this ledger
shall be made, the first one is to be kept in the divan of Egypt and the other one in
the Dergh- muall, the palace of the Ottoman Sultan.
f. From now on, all waqfs are to be inspected annually and their accounts are to be
submitted to the governor. If these accounts are approved, they will be stamped
and a copy thereof shall be kept by the Palace.
g. From now on, all the hospital and cemetery waqfs whose management had been
entrusted to the former Mamluk notables, shall be managed by trustees chosen by
the nzr- evkaf and they shall be considered as part of the hassa-i hmayn,
Sultans domain.
h. Many waqfs in Egypt have been subjected to ibdal/istibdal on the grounds that
the waqf property is in ruins. Such transactions are now prohibited by the order of
the Sultan. If, despite this warning, a waqf property is sold, both the seller and the
purchaser shall be severely punished.
i. If after an inspection it is determined that embezzlement has indeed taken place,
the culprit shall first compensate the waqf and then shall be punished (Akgndz,
1993: VI/II).
It should be noted that this kanunname was issued during the reign not of Selim, the
conqueror of Egypt, but of his son, Sleyman the Magnificent. In general it is an impressive
legal document demonstrating how seriously the new rulers took the waqf affairs of Egypt.

70
Item c makes it clear that the trustee could keep his position subject to the
fulfilment of the original conditions stipulated by the founder. Item d is the direct
application of one of the ten conditions of the Hanafi law regarding waqfs, the so-called itahirman, or pay/freeze. This pertains to the ability of a founder to freeze payment to a
particular beneficiary so that he is able to pay larger amounts to another one who has priority.
It is interesting that with this kanunname this right to determine priorities is also granted to
the ruler or his agents as well.
Finally, items h and i are serious warnings for those who may be involved in
istibdal transactions. The language of the law is such that capital punishment cannot be
excluded and, indeed, it was because of an istibdal controversy that Tarabulsi, the first
Hanafi Chief Kadi of Egypt after the conquest, was condemned to death by Ottoman
authorities (Behrens-Abouseif, 1994: 30). This is not only a dramatic but also a highly
interesting case. For here we observe a possible conflict between the Hanafi and state laws.
Whereas, as we have seen above, the former would allow istibdal, under certain stringent
conditions, apparently, the latter prevailed, as Tarabulsi learned at the cost of his life. Since,
being the very first Hanafi judge of Egypt he must have known that his decisions would be
closely watched, we may safely assume that he gave his permission to this istibdal after very
careful consideration. It is therefore possible that Tarabulsi may have been made an example
of, i.e., this execution of a Hanafi judge, must have given the new rulers an opportunity to
demonstrate their seriousness in waqf affairs. Thus, a very clear message was given: the new
regime was as devotedly Muslim as the previous one and it was not going to tolerate
embezzlement.
Stressing common religious identity during his stay in Egypt, Sultan Selim made
donations to shrines and mosques, including foundations and mausoleums of Mamluk
sultans. Although, during the initial establishment of the Ottoman authority Sultan Selim had
a large number of Mamluk soldiers massacred, in time as the turmoil waned, he granted
amnesty to the survivors, respected their property rights and gave them the opportunity to
join the Ottoman army of Egypt. Even Sultan al-Ghuris endowments were confirmed
through a decree Selim issued in 1517 (Behrens-Abouseif, 1994: 148).
According to Ishaqi, Egypt was saturated with waqfs by the end of the Mamluk
period with 10 of its 24 qirats turned into waqfs by the Circassian Mamluks alone. Almost
every aspect of urban life had become in some way entangled in the web of pious
foundations. The entire religious establishment lived on waqf posts, and for the Ottomans,
who had to govern Egypt from a distance, it was a matter of vital interest to satisfy this most
critical sector of society.
The funds from pious endowments represented a very important share of Egypts
urban and agricultural resources. Almost no building was erected in Ottoman Cairo without
the involvement of a waqf estate because virtually all of Cairos land and buildings had
already been made waqf by the end of the Mamluk period. With such a large share of the
countrys resources being controlled by the waqfs, the system had to be reckoned with as a
dominant buyer in the market. Actually, the possible impact of the waqf system on the
economy as an oligopsony has not yet been studied by economic historians.
The only major change effected in the Egyptian waqf system with the coming of the
Ottomans was the fact that the waqfs in Ottoman Egypt were removed from the supervision
of the Shafii and put under Hanafi judges. But this did not mean that the other schools were
not respected. On the contrary, by maintaining the validity of the 4 legal rites in Egypt, the
Ottomans gave the jurists the ability to apply the rite, which was most favourable under
individual circumstances, and this increased their flexibility in dealing with waqf estates.
Pious endowments were a delicate matter, and the Ottoman rulers stipulated that the pious
endowments of the Mamluks should not be violated as long as their legality could be
confirmed, a principle that was also stated in the Kanunname of Egypt.
Between their desire to respect Islamic law and the need to provide the treasury with
revenue, the Ottomans were in a difficult position that made new regulations necessary. The

71
Ottomans did not exempt pious endowments from taxes. Taxes that belonged to the treasury
did not cease when landed property was made waqf. It seems that the collection of taxes on
estates that had been alienated for a charitable purpose was also observed elsewhere in the
Muslim world, as McChesney shows for Central Asia.
Thus sultanic orders were issued to collect taxes on waqf land. This law, however,
did not remain undisputed and the Egyptian Hanafi scholar Ibn Nujaym wrote a treatise in
which he tried to defend the interests of the Egyptians and their waqfs against Ottoman fiscal
policy. The stratagems formerly used by the Mamluks to escape confiscation as well as
inheritance taxes by turning their iqta estates into waqfs, were thus counteracted. Moreover,
tax-farmers had to ask for permission before endowing a pious foundation with land. In cases
of very large religious endowments, the pious foundation, itself, was subject to taxation.
Sometimes a duty called mal himaya was paid for the protection of waqf estates.
Returning to the istibdal transactions, again, it should be noted that notwithstanding
the severity of punishment mentioned above, these transactions did not cease. Although
istibdal was prohibited by the Kanunname, and notwithstanding the dramatic affair
mentioned above, it continued to be used, especially if the endower permitted it or if the kadi
saw no alternative way of rescuing an estate alienated as waqf.
The following case should illustrate the point: to build his madrasa in the Qusun
quarter, Sleyman Pasha made use of istibdal in 949/1543, less than a decade after the
promulgation of the Kanunname! The protocol of this transaction exists, and it is a most
valuable source for showing how the Ottomans dealt with Mamluk waqfs. The agreement
was made before the Chief Kadi, who luckily was also the supervisor of the waqf of
Sleyman Pasha and followed the pashas stipulations. After stating the duty of all Muslims
to erect religious foundations, the protocol described the buildings belonging to the waqf of
Qurqumas in the Qusun quarter, as being in a dilapidated state. A commission of experts and
architects inspected the estate and came to the conclusion that, left unattended, the buildings
would fall further into ruin and would be of no use. The chief kadi therefore gave his consent
to an istibdal, and Sleyman Pasha acquired, for the foundation of his future madrasa, the
dilapidated buildings and the land on which they stood for the sum of 317 gold dinars. This
amount was paid to the supervisor of the waqf of Qurqumas, to enable him to purchase
another estate for the religious endowment (Behrens-Abouseif, 1994: 154).
Because Egypt was a major supplier of sugar, grain and other food commodities to
the Ottomans, it was necessary to secure the infrastructure needed for transporting these
products. Moreover, Egypt was the connection between Abyssinia, the Hejaz, Yemen, North
Africa and the rest of the Empire. Pilgrimage to the holy cities would simply have been
impossible without the regular supplies of grain from Egypt (izaka, 1996: 86-88). The
Ottomans financed their pious deeds with commercial projects that had to be lucrative and at
the same time serve more global interests, as for example, the development of the ports. The
waqfs of the pashas were significant in that enterprise. The sea route between Istanbul and
the Egyptian province was a vital connection and more advantageous than the longer land
route via Syria and Anatolia. Egypts ports of Bulaq, Rosetta, Alexandria, Suez, and
Damietta were prosperous because they benefited from expanded trade relations between
Anatolia and Egypt. After the Ottoman conquest, Egypt gained access to the Empires large
market and made great profits from the coffee trade, which compensated for the decline of
the spice trade in the early sixteenth century. The Ottoman kanunname includes a section on
the ports as centres of foreign trade (Akgndz, 1991: 121-123). The ports of Rosetta,
Damietta, and Alexandria were also distribution centres for the local market.
Unlike the Mamluk sultans, the Ottoman pashas did not involve themselves in
prestigious architectural projects. The buildings they erected were generally unpretentious.
Except for Sinan Pashas buildings in Bulaq, the pashas did not initiate large urban projects,
but rather directed their attention towards maintenance operations that might not look
prestigious but nonetheless fulfilled practical ends. This demonstrates that the main concern
of the pashas was not urban development as had been the case in fifteenth and sixteenth

72
century Istanbul and other Ottoman cities, but urban maintenance. One may therefore say that
the waqf policy of the Ottomans in Egypt, during the classical era, did not follow a centrally
regulated strict scheme; rather, the waqf was used as a flexible instrument for the application
of a public policy that was defined in broad terms. Actually, utilizing the waqf as an
instrument of public policy was not an Ottoman invention. Earlier examples have been
observed under the Seluks in Iran to which we will refer below.
3. Crises in the Late Ottoman Era and the Republic:
Beginning with the reign of Muhammad Ali Pasha, a new wave of centralization of
the waqf system was initiated. Noting that the waqfs had removed at least a fifth of the land
from taxation, Muhammad Ali began to reassert state control. His attempt to control
culminated in the cadastral survey of 1813-14, which paved the way to the reclassification of
much waqf land as miri, i.e., state-owned land that was subject to taxation (Cuno, 1982: 107).
Ismail continued this policy by establishing, for the first time, a Waqf Ministry. This
took over many waqfs from the nazirs (trustees) whose position did not conform to the law.
After the British occupation, the power of the trustees was reduced even more with the
Regulation of Waqf Administration of July 1895, which remained in force with minor
changes until the middle of the twentieth century.
But a new conflict between the British and the Khedive was centred on the Waqf
Ministry itself. Realising that the British had started to use the Ministry as a venue for their
policies, Tawfiq abolished in 1884 the Waqf Ministry and established in its place a General
Administration directly responsible to him. A fierce controversy soon surfaced over the
control of the Egyptian waqf system. At the end, a compromise was reached: the British
demands to restore the Ministry had to be complied with but the Ministry retained financial
and administrative autonomy and the Minister, himself, was to be appointed directly by the
Khedive.
During the Constitutional Monarchy (1923-52), the King tried to maintain the
traditional right of the ruler to administer the waqfs. Based upon Section 153 of the 1923
Constitution, which regulated the way in which the King was to exercise his authority over
religious institutions, the King continued to consider the Waqf Ministry as his personal
agency. This attitude is confirmed by an order issued from the Royal Cabinet in August 1948
to the Minister of Awqaf that he should transfer the administration of a waqf founded by
Khedive Ismail from the Ministry to the Diwan of private royal awqaf. The order was carried
out and this particular waqf, together with many others, were delivered to royal control in
the years 1945 to 1949.
Meanwhile the universal tendency of the waqf system to expand was also observed in
Egypt: waqf lands were growing by an average of 20,000 feddans annually during the early
twenties. Just when some concerned individuals were beginning to worry that bulk of Egypts
lands would be converted into waqf land, news of the radical Turkish reforms reached Egypt,
which were hailed by some Egyptian reformers from the parliamentary tribune (Baer, 1969:
84-85). The 1926 Law passed in Turkey, some months before the abandonment of the Sharia
in general, had provided for the liquidation of the waqfs, and as we have seen above, a
massive destruction of Turkish waqf property had ensued. In the same year the Committee of
the Waqfs in the Egyptian Chamber of Deputies, in presenting its report on the budget of the
Ministry of Awqaf, made some pungent criticism of the system and remarked:
These and other considerations make it incumbent on Parliament and those who
watch over the countrys economic and social affairs to consider whether the system
ought, or ought not, to continue.
In short, impact of modernism in waqf affairs had reached Egypt via Turkey and
Egyptians, perhaps for the first time, began to envisage putting an end to the whole system.

73
Armed with the news of reforms from Turkey, Egyptian reformists launched a
campaign attempting to prove that Islam in its original form was not incompatible with
liberal Western ideas and that only later corruptions resulted in practices which conflict with
the modern point of view. Thus, bitter controversies and persistent criticism observed
elsewhere also surfaced in Egypt. Modernists repeated the orientalists thesis that the family
waqfs had no religious basis whatever, and could therefore be reformed according to modern
requirements.44 Moreover, there were constant complaints from multitudinous beneficiaries
that waqf administrators proved dishonest, high-handed, and negligent, but could never
satisfactorily be brought to account. There was also the argument that a considerable part of
the material and even human resources of the country lay idle under a dead hand, with
houses derelict for lack of repair, estates impoverished for lack of development and
beneficiaries indolent for lack of incentive to work.
These attacks should be considered as part of a concerted onslaught on the system reenforced by social and economic theories from the West, inspired by the eighteenth century
French philosophers and the Revolution. As we have seen before, it was under similar
influences that the Turkish reformers demanded the complete abolition of the awqaf on the
grounds that their wide diffusion crippled the public economy in favour of family
perpetuities of the most pernicious kind. And much earlier, it was still under the same
influences that Muhammad Ali in Egypt had issued his famous irade-i seniye forbidding the
creation of any further waqfs.
Two powerful groups, the ulema and the royalists, provided opposition to the
reformists. The most prominent member of the former was Sheikh Muhammad Bakhit,
formerly Mufti of Alexandria, whose opinion, it will be remembered, had been asked by
Suhrawardy concerning the cash waqfs. In two lectures, delivered in reply to the modernists,
Sheikh Bakhit refuted the claim that the waqf had no religious basis and that it was
economically harmful. After this, he pointed out the vital importance of this institution for
poverty alleviation, education and health. Were it not for their being waqf, he said, many
properties would have fallen into the hands of foreign money lenders (Baer, 1969: 85).
The royalists, headed by Prince Umar Tusun, launched their own offensive to the
reformist drafts of the new waqf law, on the grounds that they imposed restrictions on
property rights and that the spirit of the proposed law was one of disregard for the property
of the great families. In the senate debate other royalists also challenged the modernists and
emphasised usefulness of the family waqfs.
The principal exponent of the modernist view was Muhammad Ali Alluba Pasha of
the Liberal Constitutionalist Party, who had once been the Minister of Waqfs. In a draft law,
which he submitted to the parliament in 1927, he proposed that in the future, family waqfs
should be temporary and be endowed for a maximum of 30 years. Moreover, in a series of
lectures he argued for the prohibition of de facto primogeniture, for the annulling of family
waqfs established prior to a certain date, and for the right of beneficiaries to divide the waqf
property into separate waqfs according to each ones share of the income. Some of these
views have been adopted by others and were finally incorporated into the Waqf Law of 1946.
Other reformers were not satisfied by Alluba Pashas proposals and advocated
nothing less than a complete abolition of family waqfs. They were a heterogeneous lot with
no common denominator. Some of them were a group of Western oriented intellectuals,
while others headed by Abd al-Hamid Abd al-Haqq, founder of the Egyptian Workers
Party, were straightforward socialists. The main slogan of this party, similar to that of the
Turkish Peoples Party, was the outright abolition of the family waqfs. But even the Liberal
Constitutionalists and Fascists were demanding the prohibition of creating new family
waqfs. The efforts of these groups were halted when the parliament itself was dissolved.

For the influence of modernism on the waqf controversy in Egypt see; (Schacht,
1932)
44

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Thus, dissolution was the fate of the Parliament before being the fate of the waqf (Baer,
1969: 87).
In 1936 and 1937 modernising efforts were resumed and culminated in the Law no.
48 of 1946. The new law attempted to impede de facto primogeniture by restricting the
creation of new waqfs thus limiting the motive for turning property into waqf. It also
imposed a limit of a maximum of 60 years to a family waqf and confirmed that a public
waqf, waqf khayri can be established in perpetuity. Moreover, Alluba Pashas earlier
proposal was accepted and beneficiaries were allowed to divide their waqf into separate
waqfs according to their shares in the income.
This reform represents an almost revolutionary change in the waqf system. It was
however, facilitated by the fact that Abu Yusuf himself had held that a waqf might validly be
made for the benefit of some particular individual, after whose death the property would
revert to the heirs of the founder. Maliki authority may also be quoted for such a proposition.
The invalidity of any family waqf, which exceeded the prescribed limits, was supported by
reference to those jurists who held that family waqfs in toto were invalid. Only a waqf of a
mosque or cemetery must necessarily be perpetual; for on this point almost all jurists are
agreed.
The reader may wonder, what the rationale for limiting the life span of a family waqf
might be. This rationale is explained in the Explanatory Memorandum where family
perpetuities are considered as a form of interdiction on series of unborn persons, of whose
characters and abilities the founder could have had no knowledge (Anderson, 1952: 262). But
the real motive should be sought elsewhere.
Bringing a waqf to an end subject to the extinction of a beneficiary should be linked
to the efforts of rendering a waqf more like private property. Such efforts are also visible in
the provision for the compulsory and final separation of any beneficiarys share in a waqf,
from the rest of the waqf property; by enacting that he should himself be appointed
administrator thereof, and by ensuring that each beneficiarys share in the waqf income
should always go straight to his descendants and that such distribution should never
unnecessarily be upset. Where, moreover, the above provisions are inapplicable, the
administrator must be chosen, where possible, from among the number of the beneficiaries
and largely at the discretion of those with the major entitlements. This person, moreover,
shall be held responsible to the beneficiaries for negligence or wrongdoing; and is liable to
punishment if he fails to present his accounts, together with supporting receipts, whenever
the court shall so demand.
To bring the waqf closer in line with private property, the law also stipulates that if
the court divides up a waqf, or if a beneficiary has a separate share therein, each beneficiary
must be made administrator over his own share even if this is contrary to the provisions of
the founder! Article 49 also provides further support by stipulating that
No outsider shall be made administrator over a waqf where one of the beneficiaries
is suitable to administer it: while if those with the major entitlement agree in
choosing a particular administrator, the Kadi shall appoint him unless he considers
this contrary to the general interests
The reasons which prompted these innovations has been noted in the Explanatory
Memorandum as follows:
Perhaps the chief causes for complaints against the waqf system has been that most
of them oppress the beneficiaries and defraud them of their rights and their
shameful neglect of the waqf itself which occasions decrease of revenue and often
ruin of the property or even its total loss The cause of this is simply that they are
not acting in their own interests at all for it is rare for one who acts in the interest
of another to be free from greed, covetousness and negligence

75

Thus the Law Maker found the remedy to this agency problem by making each beneficiary,
whenever possible, directly in charge of his share of the waqf. The juristic basis for this
reform is found in the Hanafi doctrine that the kadi may, in the interests of the waqf, remove
one administrator and appoint another in his place, even where the former was an upright
man and had been appointed by the founder.
Another major blow to the traditional Egyptian family waqfs was dealt with by the
military regime and its Agrarian Reform Law (September 14, 1952), which declared that all
waqfs for other than charitable purposes are considered to be null and void (existing ones as
well as those to be created in the future). The property of the existing waqfs were either to
be divided among the beneficiaries or revert to the founder if he were still alive and had
reserved for himself the right to revoke his waqf.
The abolition of family waqfs is said to be based upon the principles of Shariah as
well as to the principles of the newly established socialism (Barbar and Kepel, n.d.: 18). It
goes without saying that whereas the former was just a pretext, the latter was the real motive.
This is also confirmed by the later actions of the Nasser era. When the family waqfs were
abolished, the Ministry of Awqaf assumed the trusteeship of all such waqfs. Moreover, the
Ministry was also authorised to distribute the proceeds of the waqfs without consulting the
original stipulations laid down by the founder (Barbar and Kepel, n.d.: 20). This was
followed by the Law no.547, 1953, which deprived the founder of the right to appoint a
specific trustee who would take over the waqf after him.
Although the abolition of the family waqfs met with little opposition, the execution
of the law met with some difficulties. A major difficulty was the excessive division of the
waqf property among too many beneficiaries. If such a division resulted in each beneficiary
receiving less than five feddans, this would have conflicted with the Agrarian Reform Law.
Another difficulty was to distinguish the public segment of the waqf from the family one,
which should have been expected, as Islamic law does not feel the need to distinguish
between the two. Since most waqf deeds did not therefore clearly demarcate these segments,
this problem led to a huge amount of litigation.
When King Faruq was exiled on July 26, 1952, the public waqfs administered by the
King were also taken over by the Ministry. Thus, more than a 100,000 feddans of waqf lands
were taken over. One year later, a new law gave the Ministry of Awqaf the right to administer
all public waqfs. Only those waqfs whose founders also acted as trustees were exempt from
this rule.
This law met with fierce opposition on the grounds that it was:
a) Unconstitutional since the revolutionary constitution had guaranteed property rights
b) Contrary to the Shariah, which gives utmost priority to the conditions, laid down by the
founder. This priority, it has been argued, is such that the original provision laid down by
a founder of a waqf is considered to be as binding as the text of the Shariah.
But these objections notwithstanding, the transfer was gradually carried out and most
trustees handed over their waqfs to the Ministry. Moreover, with total disregard for the
objections in item b, Article 1 of the same law promulgated that the Minister of Waqfs had
the right to spend the revenue of any public waqf on a purpose designed by him without
being bound by the original conditions stipulated by the founder.
This blatant violation of the Islamic law was justified on the grounds that many
Egyptian waqfs had originally been dedicated to objects in Turkey. This argument was given
great publicity in the media supporting the new law. Thus for all practical purposes it can be
argued that the public waqfs in Egypt have been nationalised: they have ended up being
managed by a government department, which has been authorised to spend their revenue
according to its needs.
The final blow to the waqf system in Egyptian agriculture was dealt with by a new
law promulgated on July 18, 1957. According to its provisions, all agricultural lands

76
belonging to public waqfs were to be transferred to the Land Reform Committee and to be
distributed according to the Land Reform Law. Their former trustees were to receive Land
Reform Bonds. The principal of these bonds was to be transferred to the Economic
Organisation of the Government and invested in development projects. The former trustees,
on the other hand, were to receive interest due on the bonds and later profits from the
invested capital.
The 1957 Law hit the waqf system from both ends; while, on the one hand, it
deprived the public waqfs of their landed revenues, on the other, it constituted a huge
impediment for the endowment of new waqfs. For, surely, any person who might
contemplate establishing a new waqf would be disheartened by the knowledge that his land
would eventually be transferred to the Land Reform Committee.
Thus a unique combination of the abolition of the public waqfs, division of the
family waqfs among the beneficiaries and their total subjugation to the Ministry combined
with land reform meant that nationalisation, was followed by a massive process of
privatisation. These developments allowed the government to expropriate huge properties
and distribute them to landless peasants. If, as it has been often argued, private ownership of
land is more productive then share cropping practised in waqf lands, then total productivity
of Egyptian agriculture must have been significantly and positively affected by these
developments.
The above argument that the waqf lands were distributed to landless peasants,
however, must be taken with a grain of salt. For, these lands were auctioned off in 1954 and
1955 and naturally ended up in the hands of those who could best afford them. All in all, the
final outcome of the republican waqf laws has been that they have liquidated that part of
waqf property, which consisted of agricultural lands and have made the creation of new
waqfs out of agricultural lands improbable. Indeed, when all the family waqfs have been
divided among the beneficiaries and all lands of the public waqfs transferred to the Land
reform Committee, only an insignificant area of family waqfs will remain.
Finally, the Articles concerning the accountability and responsibility of
administrators expressly state that they are to be regarded as the agents of the beneficiaries,
must produce documentary support for all their expenditure except in regard to items
concerning which custom decrees otherwise, and must make good any loss caused by their
major fault or neglect.
Although these measures taken by the Nasser regime, in similar fashion to those
taken by the Kemalists in Turkey, proved to be harmful for the Egyptian waqf system, they
ended up having a limited success. For a reaction did materialise and, the 1970s under
Anwar Sadat, witnessed a revival of Islamic values, again, in similar fashion to Turkey where
the 1967 Waqf Law has achieved a resurgence of the Turkish waqf system. It is too early,
however, to write the story of this resurgence in Egypt for, the exact outcome of the
conflicting forces of the secularists and the Islamists is not yet known.
IV. THE SUDAN
The waqfs have a long history in the Sudan. It has been reported that the earliest
Sudanese waqf was a mosque in Dongala al Aguz dating back to the ninth century (Abdel
Hadi, 1997: 5). The number of Sudanese waqfs naturally increased over time and even spread
beyond the borders of Sudan when the Sultan of Sinnar, during al-Zarqa (The Funj) period,
bought lands in Mecca and Medina and endowed them for the service of Sudanese pilgrims.
This particular waqf, known as the al-Sinnariah, still exists.
But this appears to have been an exceptional situation: it has been argued that the
waqfs in Sudan were traditionally weak and were enhanced only after the joint OttomanEgyptian occupation. According to Gabriel Warburg, it was the Ottomans who introduced a
substantial waqf system comprising the Sharia Courts and the ulema. But the Mahdi uprising

77
wiped out most of these. Waqfs too were destroyed together with the opposing ulema. Only
the supporting ulema could survive. Therefore, Warburg argues, the resurgence of the waqfs
in the Sudan is a relatively late development.45 The official religious policy of the Sudanese
government under Lord Cromer, was to encourage orthodox Islam and to discourage Sufism.
Waqfs were also accepted within this framework. Support for official Islam also came from
Egypt. The central mosque of Khartoum, which was inaugurated in 1904, was largely
financed by Egyptian waqfs as were the mosques of Halfa and Tokar (Warburg, 1971: 9597).
In common with the rest of the Islamic world, the Sudanese waqfs throughout history
suffered from political instability. Frequent changes of government, which wobbled between
secularism and Islam, proved to be particularly harmful. During the secularist regimes the
waqf system deteriorated and tended to be totally ignored and forgotten. Under these
circumstances, even the declaration of independence in 1956 did not help. Financial losses
became substantial and were particularly severe during inflationary periods as at the end of
the 1970s. Those years were dominated by the military regime of Lt. General Numeiri who
kept fluctuating between socialism and Islam. During the Islamic spells, however, the
Ministry of Awqaf and Religious Affairs was established and important new legislation was
introduced. With the Awqaf and Religious Law, 1980 for instance, the Minister became the
general trustee of all the waqfs in Sudan. But most of these administrative changes had no
significant effect and the total revenues that accrued to the system were down to one million
Sudanese pounds at the end of 1989.
With the Islamic Salvation Revolution in 1989, radical changes began to be
introduced. All Islamic institutions, among them the waqfs, were given particular attention
and the Islamic Awqaf Organisation Law, 1989 was promulgated. With the revolution, a
nation wide administrative reorganisation was attempted and the country was divided into 26
autonomous states, each of which was ordered to transfer 10% of its revenue to the central
government.
These radical administrative reforms have had a direct impact on the revenue of the
waqf system: the total revenue of merely 1 million pounds in 1989 exploded to 26,456,400
pounds. Although the magnitude is tempered by the high rates of inflation (150%) and the
devaluations of the currency, it is clear that substantial increases in the revenue have been
achieved.
The legal system pertaining to the Sudanese waqfs evolved as follows: During the
Condominium (1898-1956), the Shariah Courts Law was promulgated in 1902. The bylaw
of this law, issued in 1903, regulated these courts and Article 53 set forth that the Sudanese
waqf system would henceforth be subjected to the Hanafi code. This shift from the local
Maliki to the Hanafi School reflects a belated Egyptian influence where the latter had gained
supremacy under the Ottomans and a reverse shift had occurred in 1946.
The next major development in the Sudanese waqf system occurred with the
promulgation of the Islamic Charity-Waqf Law, 1970, which codified the jurisdiction
pertaining to the waqfs. This law also bears the first signs of centralization, which has been
observed almost everywhere else in the Islamic world. Accordingly, The Ministry of
Religious Affairs obtained the right to manage the waqf system and reserved the right to
appoint a nazir. This law remained in power until 1980 when the promulgation of a new law;
al-Awqaf and the Religious Affairs introduced further centralization. Accordingly, the
Minister of Religious Affairs was appointed the General Administrator, nazir am, for the
waqfs. Shortly after this, two Shariah circulars, numbers 57 and 58, were issued.
The decision to follow the Hanafi School had a direct impact on the irrevocability of
the waqf. As it is well known, Imam Hanife allows the founder to revoke his waqf in his
lifetime on the grounds that he may face emergencies. The circulars 57 and 58 put Imam

45

I am grateful to Gabriel Warburg for this information.

78
Hanifes principle into practice.46 Thus, although the Sudanese waqfs were irrevocable
previously, with these circulars they became revocable, subject to the conditions stipulated
by these circulars (Abdel Hadi, 1997: 6-7).
Article 58 is of further interest due to the fact that it is concerned with the family waqfs,
waqf ahli. The preamble of this Article refers to the problem of the fragmentation of waqf
revenues due to the result of population increase. The beneficiaries whose numbers were
constantly rising received smaller and smaller revenues and as their numbers increased, cooperation among them became more and more difficult. Consequently, the beneficiaries
gradually lost their interest in the maintenance of the waqf properties and tended to
concentrate more and more in the distribution of whatever income was generated.
The Hanafi rule, teksr-takll, which was promulgated in this circular, allowing the
founder to increase the share of a beneficiary from the waqfs revenue while reducing that of
the others, as he sees fit, has also been the subject of complaints. In any case, the circular
introduced the following rules:
a. The judges are to examine the motive behind the establishment of a waqf and to issue
their permission after such an examination.
b. If any beneficiary makes an official complaint, his/her complaint should be taken
seriously by the courts and an examination of the waqf documents should be made. The
courts are authorised to interfere if it is proved that the founders intention was to harm
any one of the heirs.
c. If the waqf becomes void as a result of this investigation, its property should be
distributed among the legal heirs. If the deceased founder had made a will, the shares,
which exceed one-third, shall be excluded. If the heirs approve, this shall not be effected.
These rules have a number of important implications. First, the judges are authorised
to dissolve a family waqf in response to a complaint by a beneficiary. Second, Article c
shows British influence, i.e., the dissolution of the waqf property by distributing it among the
legal heirs, which in effect converts it into private property.
The year 1989 witnessed the promulgation of another law; Islamic Awqaf
Organisation, 1989. This law is of particular interest in that it demonstrates how the new
Islamic regime, The National Islamic Front, has approached the waqf issues. The first task of
the new regime was to undertake statistical research into the state of the waqfs in Sudan. The
results of this endeavour are presented below.
The new regime claims to approach the waqf issues in Sudan horizontally, by
increasing the number of endowments, whether in real estate or in cash, as well as vertically,
by better management and education to enhance waqf revenues. The former generally
occurred as direct government endowments of real estate and land. This could, however, lead
to a difficult legal problem, the ownership of the property to be endowed. When the Ottoman
sultans endowed their lands, they were establishing waqfs with privately owned property.
When the Sudanese government endows land, however, this is obviously not a private
property. Thus, we have a new situation; government owned waqfs emerging also in Sudan.47
How the Sudanese state has found a solution to this problem is not clear at the moment and
calls for further research. The details of such government owned waqfs is presented below.
The

Table 2: The Public Awqaf in Sudan

Num. Of Shops
House
Land
Others

District

Purpose

This is not a generally accepted Hanefite principle. Most other Hanefite jurists agree
on irrevocability (Akgndz, 1988: 96).
47
In Turkey, government owned waqfs were permitted by the secular 1967 Law.
Donations by the public, constitute bulk of the corpus of such waqfs and in the
Islamic Republic of Iran, confiscated properties of the previous regime were endowed
as government owned waqfs.
46

79
founder
Government

property
290

286

Government

45

39

Government

141

Government

249

249

Government

196

182

4 condo- Khartminiums Oum

+
telecom.
bld+zoo
Omdurman
2 clinics
-

East Nile
Gezira
State

1 office+ Northern
2 restau- State
rants+ 2
mills+ 2
waterwheels+2
stores

Mosque
scholars
and the
poor
Mosque
poor and
scholars
Mosque
Wages of
workers
Mosque
and
others
Mosque
and
others

Total
921
758
13
2
Source: Sumaiya Sid Ahmed Abdel Hadi, The Waqf Institution in Sudan, p. 19.
The vertical approach has taken the form of enhancing the consciousness of the
population through the media and by introducing waqf jurisprudence in to educational
syllabus. All of this has led to a resurgence of waqf establishment in the form of real estate or
cash.
The vertical approach was boosted by another law promulgated in 1991, the socalled, Personal Status Law, which carried further the Hanafi influence by introducing more
formally, the so-called, ten conditions mentioned above. Furthermore, the revocability is
restated in a more formal and definite form and the procedure is simplified. Accordingly, the
founder is allowed to revoke his waqf if;
a. His revocation is stated in a legal notification
b. It is in the form of direct expression
c. Legal notification of the Shariah Court is obtained.
Moreover, Article 342 has confirmed the right of the court to dissolve a family waqf.
As part of its revolutionary approach to the waqf issues, the new regime has also
restored the confiscated properties of the waqfs by the earlier governments. A genuine and
sincere interest by the new regime demonstrated by the establishment of waqfs by the
government, thorough application of the more lenient Hanafi law and expediting the
establishment of new waqfs by introducing the concept of revocability, all helped to restore
the waqf system in Sudan. Still another boost to the system was provided by allowing the
rents of the waqf properties to climb up from ridiculously low levels to the prevailing market
rates.
A most interesting and ambitious project of the Sudanese waqf system should be
mentioned here. This is the establishment of the Great Awqaf Company in 1995 financed by
donations from the public. Although it is claimed that the original idea was conceived by
Hassan A. El Turabi who was the Head of the National Islamic Front, establishment of a
large waqf with public donations is by no means a recent invention. An earlier and an
enormously successful example of such a case has been observed during the final years of the
Ottoman Empire when Sultan Abdlhamid II initiated a donation campaign with the purpose

80
of building the famous Hejaz Railway (Usul, 1999). The capital of this enterprise was
donated by the Ottoman public as well as by the pious Muslims from all over the Islamic
world. The railway, when completed, was hailed as the only one of its kind that did not have
debts, or interest payments and began to enjoy profits as soon as it became operational (Usul,
1999: 12-13).
Whether Turabi was inspired by the Hejaz Railway or just reinvented an old idea, he
envisaged that this company would have branches all over the Sudan and the capital would be
provided by private donations. The value of shares was kept deliberately low, 1,000 Sudanese
pounds (US$ 0.58) in order to maximise public participation. Starting with the tribal
chieftains, a national mood of mobilisation prevailed and on the 18th May 1995 the company
was established with a paid up capital of 10 billion pounds. Thus, the Great Awqaf Company
is essentially a large cash waqf. The basic aim of the company is to popularise waqf
establishment throughout the country. Other targets are as follows:
a. To implement social justice in the community
b. To encourage spending for charity
c. To invest the cash capital to ensure its steady and sustained growth
d. To provide services for Sudanese pilgrims48.
e. To be involved in infrastructure projects
f. To build mosques, hospitals, schools and homes for the senior citizens.
g. To establish affiliated joint-stock companies:
i. To have them implement its engineering projects
ii. To share in their profits and enhance its own revenues49
The headquarters of the company is in Khartoum. The company has two accounts, one in
hard currency and the other in local. It also has a list of contributors who have pledged to
purchase the shares. These shares have already been sold to these founders. Some shares
were also sold off to the Sudanese expatriates employed in the Gulf States, who paid in hard
currency. Thus, the combination of the structures of a cash waqf with that of a joint-stock
company can also be found in Sudan. It is an exciting combination from the point of view of
the evolution of financial organisations and has previously been observed in Turkey. The
performance of this company, together with its counter parts in Turkey, need to be closely
monitored. For, if successful, they may well provide an example to the rest of the Islamic
world.
The statistical evidence for the restoration of the Sudanese waqf system is presented in the
following table.
State
Khartoum

Table 3: Sudanese Awqaf in Eight States

No.
of Shops
Houses
Land
Others
properties
137
253
38
6
26

Cash
a) 200 shares
in
Commer.
Bank.
b)35 shares in
textile co.
c) 600 shares
in
National
Cinema Co.

In this way the company approaches that of Malaysian Tabung Hadji and the
Turkish Diyanet Vakfi.
49
The Engineering Awqaf Company was established in the same year as the mother
company, 1995.
48

81
Gezira
162
114
4
12
23
Sinnar
16
11
4
White Nile
59
38
2
3
16
Kordofan
128
40
8
69
The Eastern
121
81
7
1
32
River Nile
15
6
7
3
Source: Sumaiya S.A.Abdel Hadi, The Waqf Institution in Sudan, p. 20.

It has also been reported that an affiliated waqf company specialising in construction
has been founded. The basic purpose of this company is to restore old waqf buildings as well
as to build new dwellings. The finance is secured through musharaka al-mutanakisa, a
modern method of finance used by Islamic banks particularly for construction sector
investments (Ismail, 1998). 50
To conclude, Sudan provides a fascinating example of how the waqf system can be
restored by a regime, which is not hostile to it.

V. MOROCCO
Morocco has a rich waqf (habous) heritage. But this heritage was not formed uniformly over
the long run. Whereas in a relatively short period of almost twenty years, 1740-1759, nearly
40% of all the registered waqfs had been founded (altogether 138 waqfs), after 1810 only one
waqf per year was established. The reasons behind this discrepancy should become clear
below. Meanwhile it might be noted that about 31% of the individuals who founded these
waqfs were women (Stber, 1986).
The earliest signs of centralization occurred during the sixteenth century when the
Qarawiyin mosque waqf was run by a central office. The family waqfs, on the other hand,
enjoyed substantial autonomy. By the eighteenth century, rulers were trying to expand their
control over the whole system. In this period the office of nazir an-nuzzar was established
and a centralised system of waqf registers was organised. The rulers who were behind these
developments were motivated to centralise the awqaf as a reaction to the alleged role the
waqfs played in the uprisings.
Centralization gained momentum during the nineteenth century when the rulers
attempted to intervene in the management of the waqfs. This occurred, on the one hand, by
subjecting the appointment of a trustee to the approval of the ruler and, on the other, by direct
interference in the management of the waqf properties. During the second half of the century,
as the pressure of the European powers increased, other concessions were granted to the
Europeans and their protges. These concessions were basically in the form of
ibdal/istibdal, which led to the usurpation of the waqf properties.
The Morocco waqfs entered into a new phase with the establishment of the French
and Spanish protectorates. The protectorate was keen to give an impression that the waqfs
were respected by the new regime and that any change in their organisation was for their own
benefit. The organisation of the waqfs with local offices, with the trustees appointed by the
Sultan etc. remained basically intact. Yet the power of these trustees was limited by a number
of rules and regulations. These trustees were attached to a higher officer, the muraqib. In the
French zone muraqabah offices were established in Fs, Mekns, Marrakech, Rabat and
Mazagan. By 1912 a General Directorate of Habous was established which was transformed
into the Ministry of Habous in 1915. The Minister of Habous was at the head of the central
organisation. The ministry not only was empowered to control the monthly accounts of the
waqfs, but could also take decisions concerning long-term lease, or even ibdal/istibdal of
waqf properties.

50

For full details of musharaka al-mutanakisa, see: (Mahdi 1995).

82
In an attempt to perpetuate the myth that the waqf affairs continued to be run by the
Moroccans, the French abstained from any direct interference in the habous affairs. Yet they
controlled, through the Ministry, all the financial transactions: checks payable had to be
signed by the ministry officials and all the important decisions were taken by the French
authorities. An office of the ministry, the Service dinspection, audited the trustees annually.
In short, the organisation of the habous management can be considered as an example of the
typical French colonial system whereby the Moroccan control over the institution appeared to
survive, but in reality, all the indigenous decision making powers that really mattered were
abolished.
The French rule in Morocco was influenced by the lessons learned in Algeria and
Tunisia: in Algeria colonial rulers had completely taken over waqf lands with the result that
the state was burdened with the cost of religious affairs. In Tunisia, on the other hand, the
confiscation of the family waqfs had lead to riots. In Morocco, it was therefore decided that
both strategies should be avoided and a more prudent approach was adopted. This approach
was also aided by the fact that most lands in Morocco were of no interest to the European
settlers. Indeed, whereas until 1932 ca. 12,000 ha land was sold by the habous administration
to the colonial administration for resale to the settlers, merely 5,000 ha was actually bought
by the latter. In addition to this, long term leasing, up-to 30 years, also took place: 1,500 ha
were leased by the colons and thus the waqf characteristic of these lands was maintained.
The farming-out of habous lands by public auctions appears to have been practiced
until the protectorate in Rabat. Moreover, a group of share tenants could pool their resources
and lease a waqf property in a partnership where a quarter share appears to have been quite
common. Share tenancy was also practiced in the Western Rif and the auctions were either
based on sharecropping or cash.
Under the French rule, a law dated 21 July 1913 regulated the farming-out procedure
and sharecropping was replaced by cash rents. The leasing was to be carried out in public
auctions and non-Moroccans could also participate. The law regulated leasing procedures to
the smallest detail and limited the period to 1 year, which was later expanded to 3 years.
Long-term leases, up-to 10 years could be obtained subject to the approval of the Direction
gnrale. If a tenant invested in land an amount that exceeded a 5 year long rent, he would be
eligible for 2 more extensions of the lease. For such an investment he did not have to request
permission from the waqf administration. Each one of these extensions was for 10 years, thus
effectively increasing the lease period to 30 years. For each renewal the rent would increase
by 20%. The auctions were held each year in October and the minimum auction price was
determined by the previous rent. The system continued throughout the twentieth century and
by the 1970s more than 190,000 parcels of land totalling 47,000 ha were farmed out this way.
Although long-term leases up-to 30 years were thus made possible, short-term leases
were far more frequent. The latter, however, had their own problems: the tenant was reluctant
to invest in land, the quality of which deteriorated from year to year. In response, the Central
Waqf Administration resorted to an ancient Islamic contract form: the muqarasa. Under this,
the tenant committed himself to plant a certain number of trees on the leased waqf land. The
produce of these trees would then be shared between the habous and the tenant according to a
prearranged formula. At the end of the contract period, the land as well as the trees on it were
to be divided between the waqf and the tenant. In short, the tenant ended up becoming a
landowner through the muqarasa.
It goes without saying that this particular contract form, as practiced in Morocco, was
a dubious device from the perspective of Islamic jurisprudence since it led to the loss of the
waqfs corpus. The classical Islamic muqarasa does not allow the tenant to become a
landowner: it merely allows the tenant to claim a portion of the produce of the trees until
their lives expire. The objection of the jurists notwithstanding, the Moroccan version of the
muqarasa continued to be practiced and even gained legitimacy under the protectorate. It has
been argued that the trustees agreed to this unique form of muqarasa on the grounds that
although it led to a certain loss of the waqf land, the land that remained under the waqf

83
control was enhanced in value thanks to the trees planted. It has been calculated that the
revenue yielded by the muqarasa was six times greater than normal leasing (Stber, 1986:
38-39).
Although Morocco became independent in 1956, the overall organisational structure
was maintained. The only major difference was that the French were replaced by the
Moroccans. Major change had to wait until the 1970s when the lands leased by the French
settlers reverted to Moroccans and a Direction des Affaires islamiques was established.
Another major post-independence change was observed in the further centralization of the
waqf affairs. Consequently, contrary to Islamic law, management of the waqfs is now
completely subject to the ministry and the kadi has lost all the controlling power, a
development observed in most other Islamic countries of the twentieth century.
It was also in this period that the trade unions and some political parties began to
demand that the waqf lands should be subjected to a massive land reform as in Egypt and be
distributed to the sharecroppers, who actually cultivate these lands, as private property. But
these demands were fulfilled and land reform was applied only in limited areas. On 25 July
1969 it was declared that the state could acquire habous lands in irrigated areas by ibdal or
istibdal. Within the next ten years some 13,000 ha were transferred to state ownership. Out of
these, 11,000 ha were redistributed to the peasantry.
Notwithstanding these distributions, the overall share of the habous lands in
Morocco did not decline substantially. This was because some 10,000 ha of habous lands
originally usurped by the tribes, were reregistered. In sum, the agricultural habous properties
were estimated to be about 84,840 ha, 195,850 parcels in 1977. The number of urban
properties, on the other hand, reached 33,356. There were altogether 8,292 beneficiaries
receiving revenue from these establishments.
VI. IRAN:
According to Moussavi, the earliest mention of the word, waqf, in Shiite sources
was when this word appeared as an appendage to the chapter on charity (al-sadaqa) in
Mufids al-Muqnia. It is noteworthy that there is no chapter on waqf in Kulaynis al-Kafi
although a fair portion of this book is devoted to charity. The legal rules of waqf occupy a
small portion of Tusis writings where he discusses the role of the jurisprudence in terms of
the hakim who should supervise religious endowments in the absence of an appointed
superintendent (al-nazir). By the time of Allama Hilli, the question of waqf was expanded to
several chapters, one of which was devoted to the administration. Thus, as in Sunni Islam,
among the Shiites also the development of the waqf law was a relatively late development.
The ulema benefited from the waqf as trustees and supervisors and were therefore,
naturally concerned with the development of foundations. But this concern was not confined
to the ulema; the state also instituted the office of sadr to control both religious endowments
and institutions of learning. This office, which had existed since the Timurids, flourished
under the Safavids and was divided into general and sub-sadrs. In Tadhkirat al-Muluk, the
famous Safavid book of government organisation, the task of this office is the appointment of
judges and managers of the endowments, which demonstrates the significance of the
administration of the pious foundations for the state. A slightly different definition of the
office of sadr can be found in Al amara-yi Abbasi:
The office of sadr is in charge of the well-being of the sayyids and beneficiaries of
khums, by administering, registering pious foundations (awqaf) and disbursement of funds for
religious learning (Moussavi, 1996: 228-230).
In Tadhkirah al-muluk, there are also references to the daftar-i mawqufat, an
endowments bureau, and its director was called vazir al-awqaf. He was authorised by the

84
Safavid monarchs with broad powers to supervise the dispatch of the accounts by the
mutawallis, the auditing of such accounts, the registration of the properties, etc..
We are fortunate that, thanks to Mawlawi and his colleagues, we are well informed
about a particularly important waqf, the Astan-e Qods-e Razawi located in Mashad. Their
work on this famous waqf, with an annual budget of some $2 billion, can introduce us to the
Iranian waqf system (Mawlawi, et.all. 826-837; Kazemi, 1996: 142).
The Astan-e Qods-e Razawi is the complex of buildings surrounding the tomb of the
Imam Ali al-Reza at Mashhad, the present day administrative centre of Khorasan. Before the
Imam, the Abbasid Chalif Harun al-Rashid was buried here. Actually, the Imam is buried in
the precincts of the Caliphs tomb. After Sbktigin of Ghazne destroyed the tombs,
Mahmud of Ghazne had them rebuilt later in 1009. The first endowment to the foundation
that we know of was made by the governor of Nisapur who donated a village. Over the
centuries many landed properties were endowed to these complexes. But due to the repeated
invasions from Central Asia by O uz Turks, Mongols and Uzbeks, all the waqf deeds are
lost. Only from the Safavid times onward have the title deeds been preserved.
The shrines waqf endowments include agricultural real estate as well as the nonagricultural. The former includes 500 villages and farms. The shrine also receives rents from
shops, baths, bazaars etc.. The agrarian holdings are disbursed all over Iran. The shrine has
recently expanded its holdings by selling gold objects to the Central Bank of Iran and buying
more land. These gold objects were gifts given by the pious Muslims to the waqf. Important
revenue is also earned through the shares in the Mashhad spinning mill, sugar factories,
baking factory, cold storage facility, fruit processing complex. These shares were recently
purchased for the shrine. We had seen above that Sheikh had given a fatwa Abd Allah alMazandarani, the Celebrated Mujtahid of Karbala in 1907: through which investment of waqf
funds in joint-stock companies was permitted. Thus, we are observing in the case of Astan-eQods waqf the actual application of this principle. The economic and legal implications of
the investment of waqf funds in joint-stock companies have already been explained above. It
should suffice to assert here that this flexibility allows the merger of two powerful
institutions, waqf and joint-stock companies. The Astan-e Qods-e Razawi case illustrates that
such mergers, previously observed in Turkey and Sudan, are also possible and well
established in Iran.
Concerning the expenditures of the waqf, we are informed about the following
expenditure items. It is important to take note at this point that the Astan-e Qods is not just
one waqf but a conglomerate of waqfs. This is revealed by the fact that each one of the
following expense items is financed by a number of waqfs.
a. Illumination of the chapel. Candles used to be so expensive that a number of waqfs were
established for this purpose.
b. Furnishing and carpeting (Special endowments were also established for this purpose).
c. Repair and upkeep of the buildings.
d. Material assistance, food, shelter etc., to the poor pilgrims.
e. Provision of food and medicine for the poor (numerous further
endowments).
f. Salaries of the cleaning and maintenance personnel, khuddam. Many endowments were
made for this purpose as well.
g. Mending the books in the library.
h. Procurement of legal relief for the poor.
i. Rearing of abandoned children and the provision of nurses for them.
j. Education
k. Most recently, a portion of the endowment funds have been reserved for the pensions of
the martyrs who fell during the revolution or the war with Iraq.
In addition to the above items, which constitute regular expenditure, the waqf was
also involved in major projects. The Shah Reza hospital in Mashhad, for instance, was
constructed in the year 1935 and has been maintained ever since with funds from the shrines

85
endowments. In 1975 it was handed over to the Ferdawsi University with an annual budget of
200 million tomans. Now, the hospital is called the Imams Hospital, after the revolution in
1979.
During the Safavid period the endowments of the complex were administered, as
usual, by the trustees, mutawallis. But during the Qajar period with new endowments
constantly being added, it became necessary to create a hierarchy among the trustees. A
mtevelliba was appointed who became the chief of all the mutawallis. During the Pahlawi
reign, the shah was the nominal custodian who run the affairs of the shrine through an
official. After the revolution the shrine is entrusted to the leading clergy of the city of
Mashhad.
Concerning the problem of centralization in Iran; the origins of government
administration of the awqaf can be traced back to the action of the Buyid Azud ud-Douleh
(d. 372/982) who interfered with the waqfs of the Sawad, by appointing over them inspectors
and comptrollers and paying their beneficiaries a fixed wage. Another similar case was the
seizure by the Buyids of the estates, which had been made into awqaf by the Ashari Arabs of
Qumm for the benefit of the imams (i.e. the descendants of Ali who, according to the Shiites,
succeeded him as the leader of the Muslim community) and their descendants.
There was, in all probability, a considerable area of waqf land in the Seluk empire,
but it had not by any means reached the extent it later did under the Safavids. A certain
measure of control appears to have been exercised over the awqaf by the state, which was in
keeping with the general religious policy of the Seluks. (Lambton, 1991: 27-28).
What really distinguishes the Seluks, however, is the extent to which they have
utilised the waqf as an instrument of public policy. It may seem strange that the waqf, an
institution of private law and established with purely private wealth, can be used for public
policy implementation. But this could happen, as it often did, when the founder was an
important political figure and wished to glorify his name. Particularly if such a person was,
say, a grand vizier, his private wealth could not really be separated from the public funds at
his disposal. This is because, this person could channel the taxes due to the state to his waqfs,
with the full approval of the Sultan. In this way, the boundary between the waqf pure and
simple and public investments became blurred.
Nizam al-Mlk, the Seluk grand visier under Alp Arslan, provides an excellent
example. He had embarked on a systematic policy of establishing colleges, madrasas. So far,
eleven of them have been identified all organised and financed as waqfs. Apparently, Nizam
al-Mlk exercised tight personal control over them and was directly involved in the
appointment of professors. The total revenue generated by the properties endowed for his
waqfs reached 600.000 dinars. But the bulk of this amount was provided by the one-tenth of
the state revenue that accrued to him thus confirming the argument made above about the
uncertain boundary between the private and public resources (Arjomand, 1998: 116).
The Mongol invasion under Cengiz Han that began in 1219, and culminated in the
establishment of the lhanl state by Hlagu, led once again to a process of centralisation. All
the existing waqfs were subjected to a central bureau, which made the utilisation of waqfs for
public policy even more pronounced under the lhanls. This process was carried further by
Nasreddin Tusi. A philosopher and an astronomer, Tusi was put in charge by Hlagu of
building an observatory and appointed as head of the waqf bureau of the empire. Beginning
with Ghazan Han, lhanl rulers, themselves, began to create extensive waqfs.
The Safavids tried to organise the ulema into a state-controlled bureaucracy. The
sadr liased between the Shah and the religious establishment. He was initially responsible for
the ritual cursing of the first three Caliphs; his duties were gradually enlarged to the
appointment of judges and teachers and to the administration of endowments. The Divan
Beyis office was created as a high court of appeal, and he was raised to a status equal to that
of army generals, thus bringing the administration of law under direct government control.
The Shahs also controlled the religious establishment by the provision of land and
endowments to support religious activities. The Safavids endowed additional waqfs for the

86
Astan-e Qods-e Razawi in Mashhad and for the shrine of Imam Rizas sister, Fatima, in Qum.
Grants of land called soyurgal were also made to eminent religious families, and were
allowed to pass from generation to generation immune from taxation. The religious elite thus
became part of the Iranian land-owning aristocracy (Lapidus, 1993: 296).
Some of these waqf lands had belonged to the Safavid family as private property
before they became the rulers of Persia. The greatest accession to lands of this class probably
took place during the reign of Shah Abbas, in the year 1015/1606-07 or 1016/1607-8, when
he decided to constitute all his private estates, the just value of which was 100,000 tumani
shahiyi iraqi, together with various buildings in Isfahan and the neighbourhood into a waqf
for the twelve imams and Muhammad and Fatimeh, the wife of Ali b. Abu Talib. He vested
the office of administrator in himself and thereafter in the reigning monarch. According to
the terms of the waqf deed, its revenue, after the deduction of the dues of the trustee,
mutawalli, was to be expended at his discretion and according to the exigencies of the time
(Lapidus, 1993: 112). This is an extra-ordinary and most flexible condition, as most founders
determined the expense structure of a waqf themselves.
In addition to the increase in the area of waqf land brought about by the action of the
ruling house, there was also a tendency on the part of private individuals to transform their
property into waqf. The reasons for this were not different from anywhere else; they were
purely pious motives, fear of confiscation, and tax rebates, maintaining the family lands
intact and avoidance of the fragmentation of land etc. Lambton, based upon Chardin, has
argued that if wrongly-acquired land was constituted into a waqf, or so constituted under a
false title, this title became valid after one year of uninterrupted possession, and could not
thereafter be disputed. In view of the wholesale confiscations of the similarly constructed
waqfs observed in the Ottoman lands, we wonder, why such gayri sahih awqaf in Iran should
enjoy more protection. In short, Chardins argument should be taken with a grain of salt.
Trusteeship appears to have been highly profitable. Lambton has observed that these
offices tended to be concentrated in the hands of a few individuals who accumulated vast
fortunes. Shah Abbas II redistributed these offices in an attempt to break up the large
fortunes.
Apparently, long term leases, a major problem for waqfs everywhere, were observed
in Iran as well, where they were held by their owners on a 99 years lease. During this long
period the tenants could settle and dispose of the land as they pleased. On the lapse of 99
years, a new lease for the same period was issued on payment of one years revenue. On
some lands a small annual tribute was also fixed. Thus we have a situation whereby small
annual rents are combined with a long-term lease, reminding us of the Ottoman icareteyn
waqfs (izaka, 1995: 320- 323; Kreiser, 1986). Although a more thorough comparison
between the Ottoman icareteyn and the Iranian long term lease cannot be attempted here due
to lack of data, we suspect that the latter, like the former, must have been initiated due to the
need to have the tenant restore the waqf buildings
After the Safavids, Nadir Shah accepted the throne in 1736. His reign was marked by
a massive attempt at centralization of waqf property. In the last year of his reign he
promulgated a decree for the resumption of wrongfully acquired waqfs, the extent of which,
it will be remembered, had greatly increased in Safavid times. As a result of this decree, a
considerable number of gayri sahih waqfs were taken over and incorporated into the estates
of the Shah; reminding of us those often observed centralization processes elsewhere in the
Islamic world. Thus the relative protection enjoyed by these wrongfully acquired waqfs
under the Safevids disappeared under Nadir Shah.
However, where the benefactors of a waqf and the mutawalli were powerful, they did
not in fact surrender the waqf, although it became registered in the land register of Nadir
Shah, the raqabat-i Nadiri. Other trustees fearing that the waqf under their charge would be
confiscated, did not produce their waqf deeds, and this gave an opportunity to others to
register these properties in their own names. Since all waqfs were supposed to have been
confiscated, the officials could not reject such demands for registration on the grounds that

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the land was waqf. In addition to the concealment of the true ownership of waqf properties
induced by Nadirs attempt to resume all waqf property, there was a further difficulty in
ascertaining the true ownership of many waqfs in the Isfahan area owing to the fact that the
Afghans burnt the registers of waqf property during the sack of Isfahan. Nadir died,
however, before full effect could be given to his decree. His successor, Ali Quli Adilshah,
revoked the decree and returned some of the confiscated estates, thus centralization was once
again followed by restoration and decentralization. However, Sir John Malcolm, writing at
the beginning of the nineteenth century, states that these lands were never fully restored. In
any case, there seems little doubt that in the troubled years between the end of the Safavid
dynasty and the establishment of Qajar dominion much waqf property was resumed by the
state or converted into private property. For example, the revenue of the shrine of the Imam
Riza from its endowments, which at the end of the Safavid period amounted to 15,000
khurasani tumans or 300,000 rs., had fallen by 1821-2 to some 2,000-2,500 khurasani tumans,
or 40,000-50,000 rs (Lapidus, 1993: 132).
Thus, after the Afghan invasion, the accession of Nadir Shah and assumption of
power by the Qajars (1722-1785), a serious decline in the Iranian waqf system can be
observed. Information on waqf administration under the Qajars is scarce. It can only be said
that the clergy was able to restore the institution after its eclipse throughout the eighteenth
century. Indirect evidence suggests that the waqfs had improved particularly in the regions of
Isfahan and Azerbaijan and that at the beginning of the twentieth century the waqfs were still
run by a Department of government.
In 1911 an attempt was made to rationalise the administrative structure of the waqfs.
But the most significant changes in the legal status of the waqfs were introduced, as
elsewhere in the Islamic world, by the Civil Code. The Civil Code of 1928 contained a
number of Articles with reference to the waqfs. The legal position as regards waqfs was set
out in a Subsection of Section 2, Chapter 2, of the Civil Code.
The Civil Code, recognises two kinds of waqf: charitable and family waqfs and
permits a property to be endowed only where it can be exploited without detriment to its
existence, whether it be movable or immovable, held as joint property in undivided shares
(musha) or separately (mafruz) (Article 58). Moreover, a waqf is considered to be a binding
contract and cannot be revoked (Article 61). The settlor can appoint a nazir (or overseer)
over the mutawalli to approve and take cognisance of his actions (Article 78). Thus these
conditions laid down in the Civil Code do not differ from the basic teachings of classical
Islam and lead us to the conclusion that as far as waqf affairs are concerned, Islamic
principles were by and large incorporated into the Civil Code.
The Civil Code does not lay down any definite share as the right of the administrator.
Article 84 merely states that if no share has been laid down by the settler, he can take from
the proceeds a share to recompense him for his work.
Once the proceeds of the waqf and the share of each of the beneficiaries have been
defined, the latter can take possession of their respective shares, even if the administrator has
not given (them) permission (Article 85). We can clearly observe a Western influence here.
For, giving beneficiaries such rights facilitates a transformation from waqf to private
property, a process much preferred by the Western powers.
Unless the settler otherwise stipulates, expenses for the repair of the endowed
property and matters necessary for the exploitation of the waqf have priority over the claims
of the beneficiaries (Article 86). The reader will note that this corresponds to one of the
Hanafi ten-conditions, mentioned above.
Concerning istibdal, while Articles 88-90 of the Civil Code permit sale only if the
exploitation of the land is rendered impossible or likely to become so, the prevailing view
among modern jurists is that exchange or sale is permissible if this results in the acquisition
of a better property (Lambton, 1991: 233).
Alienation of the property on a long-term lease, discussed above, is not expressly
forbidden by the Civil Code. Consequently, where waqf land is required for some public

88
development project, or in some cases merely for private purposes, it is sometimes let on a 99
years lease..
The 1934 Law introduced certain changes into the administration of awqaf.
According to this law, all the waqfs, which had no administrator, were placed under the
Ministry of Education and Awqaf, though the Ministry was at liberty to leave the waqf in the
hands of whoever was its overseer at the time. According to Article 2, in the case of
charitable waqfs with administrators, the Ministry of Education and Awqaf exercised
supervision. Note 2 to Article 2 excepted from this provision the awqaf of which the
reigning monarch was the administrator. In the case of family waqfs, the Ministry was not to
intervene except in the case of sale, when its sanction was required. In Article 9 it was laid
down that the Ministry was to receive a fee of 10% of the net income of a waqf for its
administration unless special terms for administration were laid down in the deed of
settlement. In the event of supervision alone being exercised, the remuneration of the
Ministry was to be 5%. An exception was made in the case of awqaf constituted for the
benefit of hospitals and schools; the Ministry was to levy a mere 3% for administration and
2% for supervision.
In some cases waqf land is worked directly, but more often it is leased. In such cases
the administration of the land does not materially differ from that of a large landed property
which is let. In either case a third party is interposed between the peasant and the owner of
the land or the administrator of the waqf. Often it is the mutawalli himself who rents the
property: in other words he pays a fixed sum to the foundation and keeps the remainder of the
profits from the land thus, in fact, functioning as a risk taking entrepreneur.
The general tendency is for the waqf properties to be let on terms advantageous to
the lessee; this is especially the case when the lessee is the trustee, mutawalli, himself. There
are many instances of lessees of waqf properties who have succeeded in making large profits.
The sub-letting of waqf properties is not uncommon. Although Lambton is silent on this, it is
quite possible that in addition to sub-letting, sharecropping is also practised.
As stated above, considerable areas of the country are waqf. The most important
group, both as regards extent and income, are the above-mentioned waqfs belonging to the
shrine of the Imam Riza of Mashhad. The office of the administrator of these waqfs was
vested in the reigning monarch. This is also the case with the waqfs of the Sipahsalar and
Shah Chiragh mosques in Tehran. Ten per cent of the revenues of these go to the trustee,
mutawalli. The properties, which constitute these waqfs, used to be exempt from taxation on
the grounds that the income of the monarch was not taxable. The taxation policy prior to the
grant of the Constitution was such that waqf lands were subject to taxation unless granted
immunity by a special decree or farman. Waqfs not directly linked to the ruling monarch
used to pay taxes in the same way as other landed property.
Formerly, under Riza Shah and in the early years of Muhammad Riza Shahs reign,
the shrine properties in Khurasan were let to a company, known as the Shirkati Filahati. This
arrangement was apparently unsatisfactory. The rent is said to have been comparatively low
and not to have been paid in full. The company was dissolved in 1948 and the various
properties were leased to different groups and individuals. In some cases, notably Kashmar
and Turbati Haydari, the shrine properties were rented by local landowners. A small
company known as the Shirkati Kishavarziyi Riza, was formed from the remnants of the
former Shirkati Filahati; this company rents some 20 of the shrine properties in the
neighbourhood of Mashhad, including Turuq, Shadkan, Mihrnakan, and Khiaban.
In addition to the waqfs of Imam Riza, there are various other waqf properties in
Khurasan. For example, in Kashmar the waqf of the brother of Imam Riza, known as the
Baghi Nizar , also owns property, mainly in the form of shares in the irrigation canals, qanat,
which flow through the garden of the shrine. This qanat is divided into twelve shares, of

89
which four are waqf. The annual rent per share in 1940 was 200,000 rs. ( approx. 1,176
pounds sterling).51
Isfahan was formerly, especially in the Safavid times, an important centre of waqf
property. Although the majority of this has disappeared or been usurped, a considerable
amount nevertheless remains. Similarly, some of the awqaf of the Chahar Bagh madrasah or
college, in Isfahan, were usurped by private persons. These properties, however, were
recovered by the madrasah after litigation.
In keeping with the world-wide trends of the thirties, the parliament passed the Law
of Endowments in 1934. It broadened the jurisdiction of the Department of Endowments,
which was already incorporated within the Ministry of Education. Thus, as in Turkey, in Iran
also the Ministry of Education gained a paramount role in waqf affairs in this period. This
affected the madrasah system and a period of intervention, subsidisation and direct control
over an increasing number of religious schools began. This state of affairs continued until the
end of the reign of Riza Shah Pahlawi.
The 1934 Law and the Administrative Statute of 1935 allowed the Department of
Endowments to initiate litigation against mismanaged waqfs. In effect, this enhanced the
power of the state with respect to awqaf. During the Afshar (1732-1750) and Qajar periods,
also, state as well as private absorption of waqf property was observed, so that the post 1934
developments do not constitute a sudden departure from the past. Nevertheless, the legal
changes of the mid 1930s were important instruments in the policy of a consciously
secularising dynasty.
The basic features of the 1934 Law and the Administrative Statute of 1935 were as
follows:
a. All public endowments judged to have no administrator or an unknown administrator,
were to be directly administered by the Endowments Department of the Ministry of
Education.
b. The department was empowered to exercise full supervision. Further to this, the
Department of Endowments had now the right to request registration, contest registration,
initiate court proceedings as plaintiff and enter the court as a third party on behalf of a
litigant.
c. Istibdal was permitted subject to the approval of the Department of Endowments.
d. The Department of Endowments was also empowered to legally proceed against corrupt
administrators
e. If a waqf failed to produce the original deed of endowment, it was to be administered
directly by the Department of Endowments and the latter was to receive for this service
10% of the net revenue of the waqf. This percentage was reduced to 3% in the education
and health sectors.
f. The Department of Endowments was also empowered to approve or reject the budgets
submitted by the trustees of the endowments.
g. It was promulgated that the revenue of those waqfs whose original purpose was unknown,
or, where the proceeds could no longer be used for the purposes originally stipulated were
to be disposed of. The disposal was to take place as follows: for the construction of
secular primary schools 40%, purchase of school supplies for the needy children 10%, the
Red Lion and Sun society 20%, public education 10%, publication of useful books
10%, unanticipated expenses 10%.
h. The Department of Endowments was empowered to identify a property as a foundation or
private property.

Endowing water rights constitutes an interesting but by no means a unique practice

in arid lands. A derivative of this system exists in the Turkish city of Bursa where
some thermal waters are endowed and the revenue generated is spent for the purpose
of the waqf (Baykal, 1950: 33).
51

90

i. The Department of Endowments could determine if an endowment has an administrator or

if the position was vacant

j. The Department of Endowments could determine if an administrator was unknown (by

rejecting the credentials submitted to it)

k. The Department of Endowments could appoint temporary or permanent administrators
Through these powers the government took over a number of religious schools and
could therefore discipline the administrators, teachers and the students.
To recapitulate, it can be seen from the foregoing that the institution of awqaf in Iran
had survived largely in its ancient form, although it has been brought under some measure of
state control. But a drastic change was on the way: On 27 January 1951 it was reported in the
British press that the Shah had ordered all the crown lands he had inherited from his father to
be distributed among the peasants. It was prescribed that the lands should be sold on
favourable long-term conditions and that the money received be spent on productive purposes
and on the formation of agricultural companies to benefit the peasants. The annual revenue
from these lands, which included some 800 villages, was alleged to exceed 500,000 pound
sterling. It is interesting to observe that such a procedure violates not only Islamic law but
also appears to be contrary to the provisions of the Civil Code, since the land had in the
meanwhile been made into waqf (Lambton, 1991: 257). In short, as in Egypt, a massive
conversion of waqf property into private property was being envisaged.
The Endowments office which eventually replaced the Department of Endowments,
released some statistics for the year 1964: The total annual income of all types of awqaf was
an astoundingly low $3.6 million. Since no other data exists, a comparison with earlier
times is not possible. Much was no doubt lost due to embezzlements. Even more importantly,
all the restrictions presented above may have curbed Iranians enthusiasm for establishing
new foundations. It is significant that not many new foundations were endowed in the two
decades after the Second World War. Further details of the statistics released by the
Endowments Organisation are presented below:
Total waqf properties: 73,694 riyals
Total Income of Properties: 275,458.362 riyals
Total number of religious schools: 214 or 236
Total number of students and teachers: 13,016
Total stipends distributed to the students and teachers: 11 million riyals.
The statistics also reveal severe misuse of awqaf funds. Consider the following:
Manucher Azmun, the director of the Endowments Organisation in the seventies had made
the following grants of land from the properties under his control: Large tracts of land to
various singers, 81,000 sqm to Farah Diba, 3,350 sqm to the Lions Club, 230 hectares to an
individual, 750 hectares (7.5 million sqm) to a person etc., etc. (Akhavi, 1980: 55-58, 132133).
Thus, it may be argued here that the Kemalist centralization in Turkey was reflected
not only in Egypt, as we have observed, but also in the Pahlawi Iran. Just as in Turkey, in
Iran also, during the 1930s the waqfs were brought under the state control and their income
was channelled, under the best circumstances, to secular schools. But much more tragically,
with the waqfs under state control, these institutions were at the mercy of unscrupulous
officials who did not hesitate to distribute waqf properties to totally unrelated and
undeserving individuals for personal gain. Such policies aiming at the destruction of the waqf
system also triggered reaction in Iran. But whereas the reaction in Turkey was relatively
conciliatory and found early expression in the 1967 Law, in Iran it had to wait until
Khomeini and came with an explosion. Let us now focus on the post-revolutionary Iran.
An interview made with Hojjatoleslam Imam Jamarani, Director of the postrevolutionary Awqaf and Charity Organisation has revealed that the so-called, Mudiriyet alawqaf, Waqf Directorate, enjoys an independent status and is in charge of examining and
supervising the administration of the waqfs. Apparently the categories of waqfs observed in
Turkey; those directly managed by their own trustees, mutawallis and others whose

91
management was taken over by the Waqf Directorate, also exists in Iran. While Jamarani has
pointed out the misuse and embezzlements of the waqf properties, he has expressed his
awareness that the state, in the past, has been as guilty as the unscrupulous trustees,
mutawallis. As Jamarani reports, in post-revolutionary Iran the right of the founder to
determine the purpose of the waqf is strictly observed. Any attempt to change the conditions
stipulated by the founder is considered to be in violation of the Shariah.
Realising the importance of educating the public on the significance of the waqf
system, it is envisaged that waqf management courses will be offered at universities. When
Islamic rule was introduced, it was noticed that rents collected from the waqf properties were
about 1/10th or even 1/20th of the prevailing market rates. A law, therefore, has been
promulgated to adjust rents to the market rates. Moreover, middlemen, relics of the taxfarming age, who specialised in the collection of waqf rents, have been replaced by the
Awqaf and Charity Organisation. Now the latter collects rents from the tenants directly. But
this appears to be a relic from the age of centralization for, Jamarani has not clarified whether
this rule applies only to those waqfs whose management has been taken over by the Waqf
Directorate or also to those managed directly by their own trustees, mutawallis. The former
is obviously the more likely alternative because the latter could involve a change in the
stipulations of the founder and violate the Shariah.
Islamic Republic has made a genuine effort to regain those waqf properties sold
illegally, during the Shahs regime. The Islamic Parliament, Majlis, promulgated a law
nullifying all the illegal sales of waqf property effected by the previous regime and cancelling
their ownership. Jamarani claims to have regained about 80% of such illegally sold waqf
property. These properties have now been rented out. The revenue generated by them
together with the other revenues of the directorate have been allocated to a massive
restoration effort.52
The revolutionary government has been very active in establishing new and powerful
waqfs. For instance, several major waqfs were established by the state to commemorate
special historical events and disseminate the revolutions message. Two of these, Bonyad-e
Panzdah-e Khordad (Fifteenth of Khordad Foundation) and Moasseseh-ye Nashr-e Asar-e
Hazrat-e Imam Khomeini (Organisation for Publication of Imam Khomeinis Works) are
noteworthy for the size of their resources and revolutionary activities. It was the former
institution, established to commemorate the 1963 uprising led by the late Imam Khomeini,
which offered a sum of $2 million to anyone who managed to assassinate Salman Rushdie.
This waqf also sponsored some 471,886 households in 1991 (Kazemi, 1996: 144). The latter
bonyad (waqf) receives funds from the government, Shiite khums payments and other
private donations from the pious.
The largest waqf established after the revolution is the Bunyad- Mustazafan, which
took over the confiscated properties of the Pahlawi family. According to its 1986 annual
report, the foundation employed 42,095 persons and produced 136.7 billion rials worth of
goods and services, equal to 14% of the total production by large industrial units in the
country. The number of large industrial units controlled by this bunyad was 113. The waqf
continued to grow over the years: by 1992 it has been reported that the total annual budget
for the foundation was about $10 billion. Already in 1983 the organisations director could
claim that the organisation is one of the largest conglomerates in the world and the largest
Islamic entity in Iran (Amirahmadi: 235).
Although most of the post-revolutionary waqfs have been established by the state
with confiscated property, there are also some important waqfs established by private
individuals. One of these is the Sazman-e Eqtesad-e Islami (Islamic Economic Organisation)
founded by the bazaar merchants. This organisation was involved in financing certain
commercial ventures and particularly in the import business during the Iran-Iraq war. The
loanable fund of this private waqf has reached in 1987 the staggering figure of 50 billion
52

Vaqf, Miras-e-Javidan (Tehran: Mudiriyet al-Awqaf, 1372/ 1993), vol.1, pp.6-9.

92
rials, roughly equal to 5% of the countrys total liquidity (Amirahmadi: 236). It is most
interesting that even in the Islamic Republic the usual strains between the state and private
foundations can be observed. The Sazman-e Eqtesad-e Islami, for instance, has been charged
with corruption, misuse of public funds and interference with government policies.
All in all, there is a complex relationship between the waqfs and the government in
the Islamic Republic. Although these bonyads were envisaged as separate entities, most of
them are dependent on the government for large portions of their annual budgets. They were
allocated some 20,000 million rials from the public budget in 1980, which increased to
230,000 million by 1987 (Amirahmadi: 235). In return for this financial support, they are
governed by the key members of the ruling elite and clerics, their leadership is appointed by
the president and confirmed by the spiritual leader of the regime. The linkages between them
and the state are such that some of them have been incorporated fully in the executive branch.
This sort of outright absorption has naturally removed all pretences of autonomy for these
foundations. In short, with their very corpus being constituted by confiscated property
provided by the state, post-revolutionary waqfs in Iran have become extra-ordinarily
dependent on the state and differ from all the other waqf forms we have studied until now.
Notwithstanding this dependency, however, it is quite clear that the post revolutionary waqfs
have become powerful organisations. They control huge sums and extend patronage in ways
that rival the state. Post revolutionary Iran, in short, has emerged as a unique economy
dominated by powerful state controlled waqfs.
Thanks to the efficient co-operation of the Iranian authorities, it has been possible to
obtain the current laws and regulations pertaining to the waqf system in the Islamic Republic
of Iran.53 Thus we are in a position to appraise the system under the Islamic Republic. The
earliest regulation we have is a decree (no. 630) promulgated on November 28th, 1984 by the
Council of Ministers. This is the so-called By-law of the Law of Cancellation of Selling
Deeds of Bequeathed Properties, Water and Land. In chapter two of this by-law, the
Department of Endowments is empowered to prepare a list of all waqfs whether administered
by their own trustees, mutawallis, or without any guardians. The purpose of this inquiry
was apparently to find out whether any istibdal transaction has occurred without the
permission of the religious authorities. Should such a transaction have occurred without
religious sanctioning, the committee should declare its discretion. If the new owner accepts
the decision of the committee, the deed will be cancelled. If, however, he objects to this
decision, then the case will be referred to a civil court whose judgement will be definitive
(Article 2, section B). Unauthorised istibdal transactions are thus either directly cancelled or
subjected to litigation. In the former case, the occupant is given the opportunity to lease the
premises (Article 3).
Next we come to those estates endowed by the previous regime to the agricultural
ministry. There is a problem about the lands the deposed Shah wanted to distribute to the
peasantry as private property. More accurately, it is the lands governed under the Law of
Improvement of the Public Bequeathed Villages and Farms (23 April 1971) that are being
considered here. First, it was declared that, in the case of those foundations controlled by the
Ministry of Agriculture whose deeds of ownership have not already been sold to the peasants,
such deeds shall be cancelled (Article 5, Section A).
If in case a trustee appeals to the Department of Endowments with all the valid
evidence requesting the cancellation of such a transfer of ownership, possession deeds in the
name of the endowment shall be issued (Article 5, Section B). After the execution of affairs
according to sections A and B, the Department of Endowments shall prepare leasing contracts

Rules and Regulations of Waqaf in the Islamic Republic of Iran (Teheran: Justice
Administration of Islamic Republic of Iran, translated in 1995). I am grateful to
Professor Ahmad Kazemi Moussavi of ISTAC and to H.E. Ali Reza Dardmand,
Cultural Attach at the Embassy of the Islamic Republic of Iran in Kuala Lumpur for
enabling me to have access to this important source.
53

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for the occupied endowments. In short, the waqf status of the distributed lands shall be
restored and the occupants will become tenants again.
But then, we are left with the difficult problem of what happens if an occupant has
already made a personal investment in the endowed property. It is promulgated that all such
constructions and developments shall be considered as the private property of the tenant who
has made the investment. It is also promulgated that separate contracts shall be concluded
with them for these premises (Article 7). In passing, it might be noted that this arrangement
was known as the so-called mukataal Vakf in the Ottoman/Hanefite usage and is still
valid in Turkey (Dndren, 1998: 77). Concerning those endowed properties already sold off
to the occupants, the cash amounts deposited at the Taavone Keshvarzi Bank in a government
account shall be proportionately credited to the accounts of each endowment (Article 11).
The next Article explains that for the period that has passed from the time of sale to
the new leasing contract (to be issued by the Islamic Republic) a rental fee shall be calculated
and cleared by the payments already made by the occupant farmers. If it is observed that the
farmers still have debts, the difference shall be calculated and received in cash or by
instalments from the farmers and be credited to the endowment.
Concerning the endowed waters, it is promulgated that if they have been sold without
any religious authorisation, they shall be cancelled (Article 13).
Article 14 ensures that should a waqf be in a dilapidated state, the Department of
Endowments should take the necessary measures to repair these premises in conformity with
the original wishes of the founder.
The last Article of the by-law specifically states that, the above mentioned, Astan
Ghods-e-Razavi and other well-known waqfs are also governed by the same rules.
The crux of this by-law appears to be the restoration of waqf property by the new
Islamic regime, to put an end to the istibdal transactions or at least to subject them to careful
scrutiny by the religious authorities and to convert such sales into lease contracts. Thus the
tenant farmer who became private owner of land under the Shah, once again assumes his
original status of a tenant farmer.
This by-law was soon followed by a more comprehensive bill, which was approved
on December 22, 1984. The first Article of the new law declares that the Iranian waqfs shall
from now on be administered by a new department called; Pilgrimage, Endowments and
Charity Affairs Organisation. In Article 2 it is explained that the bequests organisation shall
be separated from the Prime Ministry and shall be handled by the Ministry of Islamic
Guidance.
Article 3 is very important in that it confirms that each endowment has a legal entity
and its trustee shall be considered as its representative. The importance of this Article will be
appreciated better when compared with the present situation in Malaysia, to be presented
below, where the status of the trustee has been completely obliterated or when compared with
Turkey of 1954 where all the Ottoman cash waqfs were deprived of their legal personality
and their cash capitals were pooled to a bank.
Article 6 is also familiar with the traditional forms in that it assigns priority to the
maintenance of the endowment over all other expenditures. It will be recalled that the same
condition, known as It - hirman, can be found also among the ten conditions of the Sunni
(Hanafi) waqfs.
Article 7 is a precautionary measure against possible misuse by the trustees and gives
the power to dismiss such persons to the department. It is also promulgates that under certain
circumstances, the department can also act as the trustee and that unscrupulous trustees shall
be held responsible for the compensation of the amounts embezzled. Furthermore, such
trustees shall also be made subject to criminal investigation and, if found guilty, shall be
punished.
Article 8 promulgates that revenues of endowments whose expenses are not specified
and others purely endowed for charity purposes, can be spent on research, propaganda and
publication of Islamic culture.

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In a note attached to this Article, we find another universal feature of the waqf
system that if the income of a waqf cannot be spent for the specific purpose of the founder, it
should be spent for a purpose nearest to it. When we turn our attention to India just below,
we will see that this principle is known in India as the doctrine of cy pres and has been
imported from the English Law of Trusts.
Article 11 regulates the fees to be paid to the trustees and to the supervisors. These
fees shall be paid in accordance with the amount stated in the endowment deed or where
there is no stipulation, then the amount to be paid shall be calculated in proportion to the net
income of the endowment. This is a very important contribution to the waqf system. For, we
are observing for the first time, at least to this authors knowledge, that the trustee,
mutawalli, is being paid not a fixed salary but a proportion of the net revenue generated by
the waqf. It goes without saying that this system would have very important repercussions for
the efficiency of waqf management. Undoubtedly a trustee would do his utmost to enhance
the revenues of the waqf, if he were informed that his income would be proportional to the
net revenue he generated. Research comparing the relative efficiencies of waqfs paying fixed
salaries versus those that pay proportional salaries should yield interesting results. We
hypothesise that the latter would be substantially more efficient in view of the fact that the
well-known agency problem would have been addressed.
On May 12, and 17, 1986 two cabinet decrees were announced. One pertained to the
development of waqf lands leased to third parties. It promulgated that if the land of a waqf is
leased for development, the fair value of this land shall first be assessed by the experts of the
Ministry of Justice, then, 30% of this value, in addition to the current rental fee, shall be
obtained from the developer as royalty. In the contract the purpose of the development shall
also be clearly stated.
Should the lessee who has obtained the right to develop the land wish to transfer this
right to another person, he is obliged to pay an amount equal to 15% of the difference
between the present value of the land and that at the time of the original contract, as the
royalty transfer fee in favour of the endowment. In case the lessee erects numerous buildings
on the land of a waqf, the construction price of each unit is to be calculated according to the
Law of Possession as will the relevant royalty.
Article 3 introduces the concept of key money. If the property is let for business
purposes, local experts shall calculate this key money, which shall be received in favour of
the endowment at the time of contract. The next Article deals with procedures to be followed
should the tenant wish to transfer his tenancy rights to another person. In such a case, the
original tenant, after obtaining the approval of the trustee as well as the Department of
Pilgrimage, Endowment and Charity Affairs, must pay to the waqfs account 10% of the total
key money. All the key moneys as well as royalties are to be considered as revenue of the
pertinent waqf. When the rights of the lessee are inherited by his primary legatees, the latter
shall not be subjected to the payment of any royalty.
The second Cabinet Decree dated May 17, 1986, deals with the administrative
organisation of the pilgrimage, hajj, endowments and charities affairs. A note to Article 3 is
particularly interesting in that it grants autonomy to the mosques, theological schools and
takyas and prohibits the Department from interfering in the internal affairs of these
institutions. Thus, after about 200 years of government interference in the autonomy of
waqfs, all over the Islamic world, in Iran full religious freedom has been ensured and the
government control over the waqfs is effectively curbed. Article 4 clearly specifies that the
government can interfere in the waqf affairs only under the following conditions:
a. If the trustees refuse to register the endowments
b. In case of istibdal or transforming the nature of an endowment from the original purpose
of the founder.
c. Long term leasing. This is limited to a maximum of ten years unless approved by the
Director of the Department (Article 11, section D). Thus long term leasing which could be

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extended to 99 years in pre-revolutionary Iran has been reduced to a maximum of ten years.
In this way, the Ottoman invention of icare-i tavile leading to the icareteyn has been
effectively prevented in the Islamic Republic. Article 11, section E promulgates that when
waqf properties are to be leased, this should be done through public auctions and the bidders
should submit a guarantee of 10% of their bid. It is also promulgated (section F) that the
minimum rental amount should be published in the tender announcement. Auctions are not
demanded for small waqfs, with revenue less than RIs 200,000 or for leasing to government
organs. All the moneys received at the auctions are to be deposited at the account of the
pertinent waqf (Article 18).54
Article 19 recognises the following expenditure categories for waqfs:
a. Maintenance expenditure
b. Repairs
c. Taxes and all other dues, fees and charges etc.. Thus we are given the first hint that
Iranian waqfs do not enjoy tax exemption. More precise information on taxation matters is
provided below.
Article 20 promulgates that each waqf shall prepare an annual budget with 5 copies,
which shall be sent to the Department and other governmental bodies.
Another traditional feature is observed in Article 23, which promulgates that; all the
profits of the previous year shall be entered into the budget as net income of the following
year.
Articles 24-28 concern various measures adopted in order to supervise the waqfs and
avoid embezzlements. These Articles reveal the establishment of a serious process of
inspection.
Article 33 regulates the fees that should be paid by the waqfs for supervision and
custodianship. The Article stipulates that such fees should be paid according to the waqf
deed, if such a clause exists in the deed. If it does not, then the guardianship fee should be
calculated so that it is equal to 10% of annual net income and supervision fee at 5% of the
same net income.
Note number 3 of Article 33 states that the net income of a waqf will be equal to 80%
of the total income. Thus we are informed that the total revenue of an Iranian waqf is subject
to a 20% deduction covering fees and taxation. Article 48, however, provides relief by
stipulating that should a waqf desire to be exempted from direct taxes, it needs to obtain the
approval of the Department. Thus, tax exemption is possible. That public endowments whose
revenues are spent for charitable and pious purposes will be granted tax exemption is also
confirmed by a circular of the Department (Article number 3, no date) but, this privilege was
to become effective on 21 March 1989.
Article 35 informs us that there is a separate Department of Financial Affairs of
Endowments. This Article stipulates that all the waqfs are to send their monthly balance sheet
of the journal and general ledger including the evidences to this department.
Article 43 provides us with further information concerning istibdal transactions. It is
stipulated here that provided that the sale is legal, the proceeds are to be deposited in a bank
in the name of the endowment in question. Any sale transaction pertaining to waqf properties
are subject to the approval of the Director of the Department (Note to Article 43 above).
54

At this point the reader may wonder about the legality of auctions from the
Islamic point of view. It has been shown that auctions not only have been sanctioned
from the earliest times of Islam and therefore constitute established custom, but that
they also function as the primary instrument of resource allocation in the absence of
an official rate of interest (izaka, 1989).

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The next Article is a most interesting one and refers to the cash that is obtained as a
result of istibdal transactions. It will be recalled from above that a fatwa given by Sheikh
Abd Allah al-Mazandarani, the Celebrated Mujtahid of Karbala in 1907 had permitted
establishment of a waqf with stocks and shares. Based upon this fatwa we had come to the
conclusion that cash waqfs were permitted in Shiite law. This conclusion was first
confirmed by the investment portfolio of the famous Astan-e-Qods waqf. Further
confirmation can now be found in Article 44, which stipulates that:

a. Istibdal revenues can be used to purchase stocks and bonds

b. These papers are to be considered as the waqf itself and shall not be considered negotiable.
Negotiability shall be allowed only when another istibdal transaction takes place.
Consequently, when ibdal/istibdal converts a waqf into cash, the cash that is
obtained is considered as the waqf itself, thus once again confirming the legality of cash
waqfs. The note to this Article stipulates that when such shares are bought, the Department
shall keep in a special register the list and specifications of these stocks and bonds as well as
the shares of the endowments.
Thus, here we have a possible solution to the confiscated assets of the waqfs of
Singapore. It will be recalled that the state of Singapore, facing an acute shortage of land, had
applied an obligatory ibdal by converting real estate assets of some of the local waqfs into
cash and depositing this compensatory cash into the banks. As a result, and for all practical
purposes, these Singaporean waqfs ceased to exist. Article 44 is relevant here since it
stipulates that the cash deposited into the banks constitutes the waqf itself. If a similar law
would be promulgated in Singapore, the cash in the banks would continue to survive as cash
waqfs.
Article 45 introduces in modern Iran what we have called above as supply side
capital pooling among the waqfs. It will be recalled that Ottoman cash waqfs often pooled
their resources and contributed to each other. This is now possible in Iran because, subject to
the approval of their trustees, where the amount of cash obtained by applying istibdal does
not suffice, this Article permits a joint purchase. The Article further stipulates that the
Department may facilitate such transactions by purchasing the property itself and then divide
it among various endowments according to the capital contribution of each. In short, Article
45 allows for joint purchases subject to the approval of the trustees.
We have seen above, how in Turkey, it had become possible after 1967, for a waqf to
establish its own joint-stock company in order to benefit from the latters realised profits. We
attached a lot of importance to this development on the grounds that such arrangements
enabled the waqfs to expand their revenues by sharing in the dynamic expansion of
companies. Article 50 allows for the same developments in Iran by stipulating that the
trustees of waqfs as well as the Department itself may establish companies for the purpose of
maintenance and development of their properties. Thus the dynamic potential of such
transactions have been recognised in Iran as well. Furthermore, in Iran, when such companies
owned by waqfs realise profits, these profits have been granted tax exempt status providing
they can prove that the share holders do not use the profits for their own personal ends.55
VII. INDIA
1. Introduction

55

Circular of the Department of Endowments and Charity Affairs, no date, Article

number 5, note 1, to become effective from 21 March 1989. As well as, Board of
Ministers Decree dated 2 July 1989, number 30521/44096, Section 3.

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India can boast to be the country with the largest number of waqfs. The total has been
estimated as exceeding 250,000. Indian Muslim Awqaf or Trusts are running 2,500 secular
and technical schools, colleges, and orphanages and at least 60,000 madrasahs and 200,000
mosques (Rashid, 1987: 93; Rashid, 1997). A rough summary of a survey of Indian waqf
properties conducted way back in 1976 was as follows:
Table 4:
Number of Waqfs in India (Summary of the 1976 Survey)
Name of State/Union of Territory
Total Number of Awqaf
Andra Pradesh
34,227
Assam
96
Bihar (sunni)
1,566
(Shia)
175
Delhi
4,195
Karnataka
9,108
Kerala
3,626
Kutch
1,082
Lakshadweep
265
Madhya Pradesh
3,544
Marathawada
19,677
Orissa
2,787
Punjab
38,221
Rajasthan
18,027
Tamil Nadu
2,278
Uttar Pradesh (sunni)
9,877
(Shiah)
2,010
West Bengal
6,146
Total
156,907
Source: (S.K.Rashid, 1987: 54)
Although incomplete and out of date, this survey has been submitted here in order to give an
idea to the reader about the vastness of the Indian waqf system and its diffusion in the
country. Moreover, waqfs are being discovered in all Indian states almost as a matter of
routine. It is for this reason that Rashid is convinced that the total number of Indian waqfs
exceeds 200,000 and approaches to a quarter million.56
The earliest known waqf in India can be traced back to the last years of the twelfth
century when Muhammad ibn-Sam, one of the Ghurid Sultans, established a waqf in his
name. After the establishment of the Delhi Sultanate (1206) many other waqfs followed. One
of these was the waqf endowed for the maintenance of the tomb of Sultan Qutb Uddin. Sultan
Muhammad bin Tuqlaq had appointed Ibn Batuta, the famous Arab traveller, as the trustee of
this particular waqf.
Northern India represented the greatest frontier for North-Eastern Islam. Turks,
Mongols, Afghans and Iranians all came and settled in this vast sub-continent. The area must
have been similar to the Balkans in the far Northwest in the sense that nearly everywhere the
Muslims constituted a minority. The first Muslim state in India was founded in the Sind
during the eighth century. But its influence on the rest of the continent was negligible. It was
the Central Asian Muslims of Turkic origin who penetrated the sub-continent via the
Northwest Passage who were the greatest state builders. The Sultanates of Delhi, Jaunpur,
and the Gujarat were all established by them.

In his latest work Rashid (1997) informs us that the quarter million mark has been
crossed and more are still coming to light.
56

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Sufi sheikhs belonging to a myriad of orders played a crucial role in the conversion
of the indigenous peoples. Almost every ruler had a favourite sheikh and established waqfs to
support his shrine. But it was not only the Muslim sheikhs who received grants from the
rulers. Just as the Ottomans supported the Christian churches in the Balkans, Hindu priests in
the sub-continent also received imperial support from the Mughal rulers. The term waqf was
also used in this case even though referring to a non-Muslim institution. Hindus picked up the
terminology and used it to describe their own endowments (Kozlowski, 1985: 22-25). Not
only public graveyards but also the great Taj Mahal and other such tombs were supported by
the waqfs. This sort of imperial behaviour was imitated by the nobility and the merchants.
Thus endowment of a waqf became a highly respected norm of social behaviour.
In Mughal India (the Mughals never referred to themselves as Mughals, but as the
Bayt-i Timur or a atay), the attempts to combine the Timurid heritage and the PersoIslamic statecraft were complicated by the prevailing local conditions. First of all, the
Mughals did not push the construction of pious buildings and monuments as much as the
Ottomans. This is because, Northern India had been controlled by Muslim rulers from the
13th century onwards. The earlier Muslim states had already made ample provision for the
support of the mosques as well as for the maintenance of religious notables. Consequently,
this Mughal attitude is more similar to the Ottoman policy in Egypt rather than in the Balkans
or Anatolia.
None of the pre-Mughal dynasties survived for more than 60 years. As one succeeded
the other, much like the situation in Egypt, the new dynasty took over and preserved the
endowments made by the earlier ones. When in the year 1526 the Delhi Sultans were ousted
by the Mughals, the predecessors traditions were continued and many new waqfs were also
established.
Waqfs in India were subjected to a hierarchy of control the basic elements of which
can be identified as follows:
a. Central Administration
b. Provincial Administration
c. Local administration
Neither the Sultans nor the Mughals created a separate department for the control of
the waqfs. The Sadr us Sudur, the Mughal equivalent of the Ottoman eyhlislam, was
concerned with the waqfs. He entrusted the supervision of the awqaf at provincial level to the
sadrs (sadr-e-sabah and sadr-e-sarkar). These sadrs, however, were not empowered to
collect revenues from the waqf properties. This right was given to the diwan exclusively. The
local administration was entrusted to the kads who could be found even in the small
parganahs. On the spot supervision over the waqfs was administered by the kads. The kads
inspected the waqf accounts kept by the village mullas (mezzins).
In the final analysis it was the trustees who were responsible for looking after the
affairs of each waqf. This is still so today. As long as the trustees remained within the Islamic
law, they were not interfered with by the administrative machinery (Ibn Battuta appointed
460 persons to take care of the tombs completely upon his own initiative). Moreover, the
sultans respected the legally appointed trustees. When Sultan Aladdin (1296-1316) restored a
large number of waqfs, which were neglected, and in ruins, he sought out and restored the
trustees who had been expelled previously. But if the inspections revealed that a trustee was
corrupt, the Sultan replaced him. The waqfs were subject to a highly centralised system of
inspection. But they were left free in their normal day-to-day functioning.
2. Legal Issues
All the basic principles of the classical Islamic law, pertaining to waqfs, particularly that of
the Hanafi School, are also valid in India. While we will refer to them whenever necessary, a
summary of these will not be provided here as they are well known and have already been
mentioned above.

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What is of greater interest is the impact of British colonisation on the waqf affairs.
There are two conflicting forces here: while, on the one hand, it is acknowledged that the
British generally applied the Shariah to the Indian Muslims as a matter of policy, on the
other hand, the East India Company was granted the power to make its own laws in India, so
long as these laws were reasonable and not contrary or repugnant to the laws of the mother
country.
This policy of non-interference with the Islamic law was dictated by three main
considerations:
a. The colonial power did not want any break with the past
b. The primary interest of the British in India was to conduct trade and trade depended on
the preservation of security
c. As an interference with the religious beliefs and customs of the natives would
undermine security, the British had no desire to interfere with the religious susceptibilities
of their subjects (Rashid, 1983: 163-164).
The result of these conflicting forces was the eventual co-existence of the two
systems of law and a subtle erosion of the Shariah. How this gradual erosion affected the
Indian waqf system will be explained below.
When the East India Company in 1772 decided to claim sovereign rights and the
power of jurisdiction outside its factories, the preservation of the institutions of Islamic
law concerning the family law, succession and the Law of Waqfs was guaranteed to the
Muslims, and this guarantee has remained valid ever since. According to strict theory, the
whole of Islamic law, including the rest of Civil Law, Penal Law, and the Law of Evidence
ought to be regarded as sanctioned by religion, but no significant voice of dissent was raised
when Islamic law in these last was superseded by codes inspired by the British in the course
of the nineteenth century.
This process started with the Bengal Regulation VII of 1832 which superseded both
Hindu and Muslim laws of succession. Under them conversion to another religion would be
grounds for exclusion from inheritance. This and a host of other laws passed at the insistence
of the Christian missionaries, basically attempted to protect the rights of any Hindu or
Muslim converted to Christianity.
The Bengal Regulation was then followed by 6 enactments, the Indian Succession
Act, the Indian Contract Act, the Negotiable Instruments Act, the Indian Evidence Act, the
Transfer of Property Act and the Criminal Procedure Code. All of these enactments
superseded the principles of Shariah (Rashid, 1983: 167).
Schacht attaches great importance to these developments on the grounds that the idea
of a secular law had for the first time been accepted by the leaders of an important Islamic
community. As early as 1772, British judges had replaced the kadis in British India. The
judges were originally assisted by legal officers who were chosen from among the Muslim
scholars. These were, in fact muftis whose duty it was to state the correct doctrine of Islamic
law for the benefit of the judge. As time went on, the judges themselves in the Muslim parts
of British India were more and more recruited from the Indian Muslims. But all judges were
trained in English law, and English legal concepts such as precedent. Gradually general
principles of English common law and equity infiltrated more and more into Islamic law as
applied in India. Last but not least, the jurisdiction of the Privy Council as a final court of
appeal could not fail to influence the law itself. In this manner, Islamic law in British India
has grown into an independent legal system, substantially different from pure Islamic law.
This difference is reflected even in its very name; the Anglo-Muhammadan law.
Out of this law, a new Anglo-Muhammadan jurisprudence has grown, a
jurisprudence whose aim, in contrast with traditional Islamic one, was not to evaluate a
foreign body of legal raw material from the Islamic angle, but to apply, inspired by modern
English jurisprudence, autonomous juridical principles to Anglo-Muhammadan law. The
result is a unique symbiosis of Islamic and English legal thought in British India. But this
kind of solution is not open to the modern jurists in the Arab countries of the Middle East.

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There, Western influence on Islamic law and jurisprudence was not technically legal as it
was in India, where the influence still exerts itself through the general cultural medium of
Islamic modernism (Schacht, 1959: 111-113).
The replacement of the kadis was followed only one year later by another
momentous change: The 1793 Permanent Settlement in Bengal. This was the direct
consequence of the disastrous British attempt to apply tax-farming in Bengal. Having failed
in this, they changed course and decided to introduce private ownership of land subject to
taxation. Since the British preferred to deal with a few individuals in the collection of land
revenue, they decreed that the zamindaris, (holders of Mughal era land tenures), be given
permanent title to the lands forming their estates. Officials did not agonise whether the
zamindaris had owned their land before the settlement. The English simply did not
understand the complex subtleties of the Islamic land ownership with its multiple claims. Nor
did they care to learn the differences between rakaba and tasarruf mentioned previously.
Lord Cornwallis summed up the situation as follows:
It is immaterial to government what individual possesses the
land, provided he cultivates it, protects the cultivator, ryot,
and pays public revenue.
Thus the Permanent Settlement granted private property rights in India. After the
settlement, land could be used as a security for a loan and could be confiscated by the
creditor. The land could also be traded and inherited (Kozlowski, 1985: 33). The zamindars
received permanent title to the lands forming their estates subject to the payment of taxes.
The Permanent Settlement had a profound effect on Indian waqfs. As elsewhere in
the Islamic world, sultans and notables in medieval India considered alms giving a basic
Islamic duty. Nearly all of the ecclesiastical and educational institutions were maintained
through the waqf system. The institutions of soyurgal or madad- maash were land grants
endowed with the purpose of supporting educational institutions and relieving the learned
from the burdens of daily life. These altruistic institutions were so well established and
respected by all layers of the society that they had even survived the collapse of the Mughal
administration. Around 1765, the extent of madad- maash grants amounted to one quarter
of the total land holdings of the Bengal province.
The total disregard for Islamic property rights expressed by Lord Cornwallis,
himself, and exhibited by those who imposed the Permanent Settlement meant that much of
this land became the personal property of the trustees, mutawallis, controlling these lands. In
any case, these grants were officially abolished by the British in 1828. In 1863 the Religious
Endowment Act brought another fundamental change. With this Act, all the properties of the
pious waqfs, which were previously under the superintendence of the Board of Revenue,
were transferred to the trustees (Husain and Rashid, 1979: 20). Eyewitnesses have reported
that as a result of these developments, which victimised the beneficiaries of these awqaf;
Hundreds of ancient families were ruined and the educational system of the
Muslims, which was almost entirely maintained by rent-free grants, received
its deathblow. The scholastic classes of the Muslims were absolutely ruined.
Not only this, but the officials of the East India Company diverted the funds
dedicated to Muslim religious education to English education. Thus the estates endowed for
the provision of Islamic education were used with total disregard for the original purpose of
the founders. In 1871 the Calcutta College was headed by an English principal whose annual
salary of 1,500 pounds was paid by an Islamic endowment. The British Government tried to
cloak this blatant misuse by attaching a small Muslim school to the English College. But, out
of a total income of 5,260 pounds only 350 were allocated to the little Muslim school and out

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of the 300 boys in the English College not even 1% of the pupils were Muslims (Rashid,
1983: 163).
The British were not satisfied with the permanent settlement, abolishment of the
Mughal land grants and the 1863 Act. Viewed together, these reforms obviously had one
clear goal; establishment of private ownership of land and rendering it a freely tradable
commodity. In this context they were delighted about the Islamic law of inheritance as it
confirmed their own concepts of wealth and property, which were that property was both
alienable and inheritable and that the Mughal emperor was not the sole proprietor of land
throughout his empire. Sir William Jones considered the Islamic law of inheritance unique in
that it bore no resemblance to any other system of inheritance that the world ever knew.
The egalitarian nature of the law was admired particularly when compared with the
British primogeniture. Consequently, the British judges applied the Islamic law of inheritance
with more rigour than the kadis ever had. But although this is understandable, it did create
problems for the Muslims. This is because; having introduced full private ownership of land
and at the same time subjecting it to the Islamic law of inheritance, a very tense situation was
created. Those owners who wanted to avoid fragmentation of their newly acquired lands
faced a dilemma.
The new Muslim land owners reacted to the situation in the only way they knew:
they began to convert their estates into waqfs during the early nineteenth century. The waqf
enabled these owners/founders to apply not only primogeniture but also to avoid
fragmentation of their lands. But soon, rejected heirs took their cases to the courts.
Confronted with the choice of upholding the terms of a family waqf or dividing an estate
according to the Islamic inheritance laws, the judges customarily preferred the latter which
helped them to promote the concept of private property. Thus the British ended up provoking
the wealthy classes because they had: created private ownership of land by giving title deeds
to the land; rigidly enforced the Islamic law of inheritance and thus triggered fragmentation
and finally, denied the right to establish family endowments.
Beginning in 1879 a series of cases came to the courts most of which involved
Muslim borrowers who had pledged a share of a family waqf and failed to repay the Hindu
creditor. When the creditor had the land seized, a process sanctioned by the Permanent
Settlement, endowment beneficiaries demanded the return of the land by proving that it was a
waqf. Thus English and Islamic laws dramatically contradicted each other. One of these
cases, Abd al-Fatah v. Russomoy, was referred to the Privy Council (1894) which declared
family waqfs invalid on the grounds that the family endowments served only the interests of
the founders family and did not serve a pious purpose.
This ruling made by the highest court of the British Empire, blatantly disregarded the
Prophetic traditions and, predictably, it led to a fierce reaction from the Muslims. The most
powerful Muslim political associations began to contest the Privy Councils decision on the
grounds that family endowments had always been approved by the highest religious
authorities since the earliest era of Islam. The government remained unconvinced and
maintained its position, which had been summarised by the Bombay High Court already in
1873;
A waqf for a family settlement creates a perpetuity of the worst description, for it prevents
the alienation of the house forever and necessitates its use in a manner which, with the
natural increase in the number of descendants would probably render impossible, even if they
would be willing (which could hardly be expected) to live amicably under one roof
throughout all generation (Diwan, 1992: 132).
Not everybody agreed with these arguments though, and the ruling was criticised
even by other British judges well informed about India. Sir W.Comer Pethersan, Chief
Justice of Calcutta High Court, wrote in a paper published in Law Quarterly Review of April
1899 as follows:

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The joint family is the cherished institution which has enabled them (Indians) to
exist for ages without either a poor law, or public hospitals or charitable institutions. One of
the most curious things in the history of the administration of Eastern Law by European
judges has been the persistent way in which they have attacked this particular institution, in
the interest of the money lenders, in precisely the same way that they have attacked the
Muhammadan family settlements, which are known as waqfs, and by means of which
Muhammadans in all countries are accustomed to protect their properties (Rashid and
Husain, 1979: 128).
Thus there was a massive debate with, on the one hand, the establishment
representing the colonial and imperialist view, attacking not only the waqfs but also the
Indian extended family system and, on the other, Muslims and concerned British judges
disturbed by this relentless attack on a social system and institutions which had constituted
for centuries the back bone of Indian society. Moreover, this debate was by no means
restricted to India and, as we have seen above, was fought equally fiercely all over the
Muslim world from French North Africa, across the Ottoman Empire all the way to India.
Everywhere colonialists or modernists were attacking these institutions and Muslims were
fighting a loosing, often hopeless, rear guard action. In India, where a unique development
occurred, Muslim reaction culminated in Muhammad Ali Jinnah introducing the Muslim
Waqf Validating Act of 1911. The purpose of the Act was to eliminate the ground on which
the High Courts and the Privy Council had refused to recognise family endowments, namely
the contention that a valid waqf could only be established for charitable or pious purposes.
The act affirmed that an endowment could also be established for the benefit of the family of
the founder. Jinnahs bill passed into law on 17 February 1913. This act made it lawful for a
Muslim to create a waqf for the maintenance and support of his family, children or
descendants. Where the founder is a Hanafi, he could do so also for his own maintenance or
for the payments of his debts out of the rents and profits of the property dedicated provided
that the ultimate benefit is reserved for the poor. The law also ruled that no such waqf should
be deemed void merely because the benefits for the poor are postponed until after the
extinction of the family of the founder. This act extends to the whole of India except the
territories (Rashid and Husain, 1979: 27).
This was indeed a unique development credit for which should in retrospect be given
to the British. Indeed, had it not been for the relatively more liberal British rule, the family
endowments would have faced the same fate in India as those in Algeria. In Algeria the
Muslims remained a totally colonised population with no political rights: In India the right of
representation was extended to a limited number of natives who successfully used the
legislative process to challenge the Privy Council. Thus, while the legislative process was
used to dismantle family endowments in Algeria, in India, it was used to save them.
In short, while at one end of the Muslim world, French orientalists carried through a
cynical and successful attack on family endowments, by denouncing the institution as an
unethical and illegal evasion of the Islamic law of inheritance, i.e., exploiting an age old
inconsistency embodied in Islamic jurisprudence with which Muslims had learnt to live with
for centuries, at the other end, in India, Muslim politicians convinced the British government
that these endowments were an ancient and universal practice approved by Islamic law
(Powers, 1989: 555-565).
The debate about the family waqfs in India continued after the independence. Fyzee
has argued that the family waqfs should never have been revalidated, and pointed with
admiration, to Egypt (1952) and Syria (1949), which prohibited these endowments. Still
another modernist, Latifi, has made the following argument:
The social consequences of the (family waqfs) were devastating. It blocked any
initiative by the Muslims in the direction of industry. It perpetuated a pathetic class of

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pensioners devoid of economic incentive who were bound in the long run to become a drag
on the community. Distressed by these evils, modern jurists favour the repeal of the Act of
1913 restoring thereby the law as it stood declared by the Privy Council in 1894. It may be
added that the decision is already and has ever been since 1894 the law of Muslims in Kenya.
It is submitted that in view of the recent amendments introduced into the family waqfs in
Egypt, Syria, Tunisia and Lebanon, the Muslims (of India) should review their attitude and
adopt a more realistic approach (Latifi, 1978: 229-230).
Khalid Rashid is in favour of family waqfs but urges reform. For Rashid the real
culprit is fragmentation; that succeeding generations obtain successively smaller fractions of
the income, part of which is absorbed by the lawyers. He argues for the creation of a limited
kind of family waqf created for a specific time, say, for two generations at the end of which
the waqf may be reconstituted providing the beneficiaries agree to do so.
Paras Diwan is much more radical, and argues, This is not a novel solution. Egypt
reformed the family waqf in this manner in 1946 and since the experience was that the matter
did not improve, it abolished the family waqf altogether in 1952 (Diwan, 1992: 179).
In short, the debate on the validity of family waqfs was by no means finalised with
Jennahs victory in India. The Indian modernists, still under the impact of British values,
continue to argue about the merits of abolishing these institutions with total disregard to the
fact that they are considered to be perfectly legal from Islamic perspective.
Large-scale loss of waqf lands is another post independence development in
India. Many waqfs in India were endowed with agricultural lands. Many of these were
cultivated by tenants on share cropping basis with the trustees acting as absentee landlords.
After the independence, many states decided to abolish the zamindari and jagirdari systems
and introduced land reforms. During these radical changes waqfs also lost their lands except
what was personally cultivated by the trustees.
In many places the tenants became full proprietors on payment of prescribed amounts
to the state governments. Only later was it realised that the waqfs were established in
perpetuity and the charities would collapse if they were deprived of their source of income.
Provisions were therefore made in various enactments to grant annuities to the waqfs.
Apparently these annuities were not paid to all the waqfs in a uniform manner. Those
purely charitable/public waqfs received fairly adequate annuities but those that were partially
so (i.e., family waqfs) did not receive sufficient annuities. Other purely family waqfs
received only some compensation but no annuities whatsoever. Thus, such family waqfs
faced simply a de facto liquidation.
The West Bengal Estate Acquisition Act of 1953 granted perpetual annuity equivalent
to normal recurring annual earnings of the estate to all public, religious, or charitable waqfs.
The partial ones, i.e., partly family, partly public, on the other hand, received no annuity but
only ad hoc compensation in instalments. Since, 90% of the waqfs in West Bengal were of
mixed character, almost the whole waqf institution in that state was on the verge of
extinction. This was too much for the Central Government. It interfered and the State
Government agreed to make an amendment to allow annuity for the portion reserved in
mixed waqfs and trusts for charitable and religious purposes.
The Bihar Zamindari Abolition and Land reforms Act of 1950 granted perpetual
annuity only to those waqfs dedicated exclusively to charitable purposes provided the salary
or any allowance payable to any mutawalli did not exceed 15% of the net income dedicated
(Rashid and Husain, 1979: 92). All of these developments indicate that British influence and
the resulting discrimination against family waqfs is still a fact of life in India.
3. The Central Waqf Act, 1954
The period 1947-1954 was a critical one for the waqfs of independent India. In the
wake of partition many waqfs were left without a trustee or beneficiary, as so many of them
had fled or migrated to Pakistan. Meanwhile, a reverse migration from Pakistan resulted in

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the illegal occupation of waqf properties by displaced persons. Everyone exploited the
chaotic situation of those times to gain personal advantage at the cost of waqfs.
When concerned Muslims organised within the ranks of Anjuman Himayat-e-Islam
and Jamiat al-Ulema-al-Hind presented a detailed report to Nehru, he readily became
convinced of the immediate need for action. The result was the Central Waqf Act of 1954. It
has been argued that this Act was the best thing that happened to waqfs in India. This is
because, it is argued, for the first time after the Mughals, this Act put in place an all-India law
dealing with waqfs (Rashid, 1997: 10). Thus the worldwide trend towards centralization of
waqfs has found expression in India through this Act, which provides a landmark in the
history of the Indian waqf administration. The Act constituted Boards with authority and
powers, it imposed precise obligations upon the trustees, mutawallis, and made their violation
a penal offence, it granted state governments supervisory responsibility, it conferred on the
Central Government the authority to lay down the policies to be adopted by the Boards. With
this Act all religious and charitable endowments, irrespective of denomination, came under
state control. The management and security of all endowed property is now included in the
duties of government. The act also required that all religious and charitable endowments be
registered in the official book of endowments. The State Department of Endowments
appointed a director who was responsible to each state government for the efficient
management of the department. It was the duty of all the directors of endowments to
safeguard all the endowed property and to ensure that they were functioning according to
their original status.
In short, the act laid down a sound administrative structure to ensure proper
administration of the waqfs in the country. It has been argued that whatever lacunae existed
in the Act have been removed by the Waqf Amendment Act of 1964 and that consequently the
amended act is a very sound legislation (Rashid and Husain, 1979: 41). Notwithstanding
these claims, it is more likely that what we have here is the beginning of a major
centralization drive much like those observed nearly everywhere else in the Islamic world.
The Central Waqf Act extends to the whole of India except the states of Jammu, Kashmir,
Bihar, Uttar Pradesh, West Bengal and Gujarat. The states in italics, have their own local
waqf acts. The Central Waqf Act defines waqf in Section 3 as a permanent dedication made
by a Muslim of any movable or immovable property for any purpose recognised by the
Muslim Law as pious, religious or charitable. Thus the Act eliminates the highly
controversial issue of cash waqfs at one strike so that these waqfs are now perfectly valid in
India. Another controversial issue, the family waqfs, or the so-called waqf alal aulad, are also
permitted providing that the property was dedicated for any of the purposes mentioned above.
Section 66-C of the act also makes provisions for the creation of waqfs by non-Muslims.
Centralization of the waqf system starts with the Section 4, which states that the state
governments were to appoint a Commissioner who would carry out surveys of waqfs. The
surveys were to contain standard information. Moreover, every trustee, mutawalli, has been
obliged by the law to report and register his waqf with the State Waqf Board. Any change in
the particulars of the waqf or its mutawalli was also to be reported to the Board. Failure to do
so was made penal.
It is thanks to these surveys initiated by the Waqf Act, 1954 that we have been
informed about the huge size of the Indian waqf sector. Even more importantly, the surveys
also revealed the details of waqf estates illegally usurped (Rashid, 1997). A provision
regarding the assumption of direct management of waqf by the Board is contained in the
Central Act. Thus it is provided that the Board can assume direct management of the waqf for
a period or periods not exceeding five years. This assumption of direct management may be
deemed necessary if: the office of the mutawalli is vacant and no suitable person is found
under the terms of the waqf deed; the right of a person to act as mutawalli is disputed and the
mutawalli or a committee managing the waqf has abused its powers and failed in its duties.
Under the Act, istibdal requires permission from the Board. If an istibdal occurs
without permission, the Board orders the person in possession of the property to deliver it to

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the Board within 30 days. A person aggrieved by such an order may appeal to the District
Court.
A trustee can be removed only if three-fourths of the total members of the Board
support such a move. The trustee, mutawalli, is obliged to furnish to the Board before the
first day of May every year a full statement of the accounts of the waqf. These accounts are
audited by an auditor appointed by the Board. If a loss is caused to the waqf on account of
neglect, carelessness etc. of the mutawalli, he is liable to make good the loss under section 33
of the Central Act.
Section 46 of the Act obliges the mutawalli of every waqf to pay to the Board six
percent of the net annual income of the waqf concerned. Moreover, the Central Waqf Act has
also exempted those waqfs whose annual net income does not exceed 100 rupees from the
payment of contribution. Every mutawalli, is expected to pay his contribution to the Waqf
Board. Failure to do so, will lead to penal action against him. Such payments are deemed
necessary for the finances of the Board, which is spent for the promotion of religious and
technical education as well as welfare.
The following functions and powers given to the Waqf Board by the Act demonstrate
clearly the degree of centralization effected. The Board must:
a. Give directions to the mutawalli for the administration of the waqfs
b. Determine in what way the surplus of a waqf for which there is no waqf deed, is to be
utilised. The mutawalli of such waqfs are obliged to obey the instructions of the Board
c. Inspect the waqf properties, accounts etc. The mutawalli is obliged to allow such
inspections

d. Keep information about the origins, income, object and the beneficiaries of every waqf
e.
f.
g.
h.
i.
j.

Ensure that the income of the waqf is spent in accordance with the original purpose
Give directions for the administration of the waqf
Settle schemes of management for a waqf
Scrutinise and approve the budgets submitted by the mutawallis
Audit the accounts
Appoint and remove the mutawallis if there is a vacancy or when the right of any person
to act as a mutawalli is disputed
k. Take measures for the recovery of lost properties of any waqf
l. Institute and defend suits in court of law relating to waqfs
m. Sanction leases of property for more than three years or exchange properties according to
the provisions of the Muslim law. Istibdal done without the Boards sanction is rendered
by the Act invalid even if it has been permitted originally in the waqf deed
n. Administer the waqf fund
o. Call for statistics from the waqfs
p. Cause surveys of the waqf properties
q. Collect information about a certain property and to decide whether it is waqf property or
not. The Boards decision, unless revoked by a Civil Court, is final
r. Do all such acts as may be necessary for the due control, maintenance and administration
of waqfs.
In Bihar there are separate Sunni and Shiite waqf boards. This distinction also used
to exist in Delhi. But the two were merged in 1962. It seems the waqf boards were often
abolished and merged or re-established in parallel with the constant changes that occurred in
the borders of the Indian states. This situation seems to have created considerable confusion.
In December 1960 an Interstate Waqf Conference was convened. In the conference
the Waqf Boards complained that the funds at their disposal were very limited. To enhance
them the following were suggested:

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a. Since contribution from the waqfs are the main source of income for the boards, those
mutawallis who have not paid their contributions should be removed

b. Waqf surveys should be conducted

c. The accumulated income of the waqf properties vested in the custodians should be
transferred to the Boards

d. Funds under direct management of waqf boards should be invested

e. Interest unclaimed by the waqfs on religious grounds could be transferred to the boards
for utilisation on charitable purposes

f. Money belonging to the waqfs should be kept in public accounts if it exceeds Rs.500
Rashid claims that almost all the difficulties experienced in the working of the 1954
Act have been removed by the Waqf Amendment Act of 1964. In an attempt to reduce the
tension between various Islamic sects, an important amendment has been promulgated that if
the number of Shiite waqfs exceed 15% of the total number of waqfs in a state, separate
waqf boards are to be established.
Hitherto the Board had no authority to issue orders to a mutawalli concerning the
utilisation of his surplus funds. It can now do so.
Although the 1954 Act had authorised the Board to sanction long term leases of waqf
property or mortgage or exchange, it had not included the sale. Therefore, where sale became
a necessity, courts had to be approached. This difficulty has now been removed.
All in all, the highly praised 1954 Act and its amendment appear to have failed to
create an efficient waqf system for India. Indeed, it has been conceded that despite these
powers, the Waqf Boards have not been effective. Independent authors attribute this to the
insufficiency of the contribution of each waqf to the boards. They argue that; the five percent
of each waqfs income allocated to the waqf board is insufficient and that this amount should
be increased.
They also observe that the boards have shown themselves to be administratively
inefficient, financially weak and virtually the cesspools of corruption and nepotism. They
have consistently failed to play any significant role in the socio-economic resurrection of the
community. The internal dissentions and groupism among their members, the suppression of
one board by another are only two among many maladies which prove that they have failed in
justifying the confidence reposed in them by the community. More specifically, the Boards
have been accused of failing in their most important function: auditing. The Bihar Board
appears to have been particularly negligent. In response, the Bihar Government was forced to
supersede the Bihar Subai Sunni Majlis-e-Auqaf with effect from April 1971 (Rashid,
JIMMA: 56-57). But the Bihar Board was by no means the only culprit. Indeed, the Punjab,
Tamil Nadu and Andhra Pradesh Waqf Boards were also superseded for more or less the
same reasons. Having analysed 18 state boards, Rashid has come to the conclusion that most
boards have been ineffective in auditing and since
Audit of accounts is the only reliable means for a Waqf Board to know
whether mutawallis are fulfilling the objects of waqf according to the founders
wishes if this fundamental duty is not discharged by the Waqf Boards, they
hardly justify their existence (Rashid, JIMMA: 57).
The solution Rashid and others offer, however, appears to be more of the same
medicine; replacement of the present outmoded system with a new, rigorous and effective
one (Diwan, 1992: 171). We are left in the dark, however, about what this system would be.
It is to be feared that the new rigorous system would simply be even more, yet ineffective,
state control.
Indeed, further attempts at more vigorous control were made with the establishment
of the Waqf Section of the Government of India in 1958. After organising a conference and
some initial activity, this body has not been effective since 1974. In 1961, still another

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government body, the Central Waqf Advisory Council was established and granted statutory
status by the Government of India. The Council was to give advice to the Government on
waqf affairs, to take steps for the betterment of the community etc.. To fulfil these objectives
the Council was allocated one percent of the annual income of every waqf board as well as
some government grants and interest income. But this body also failed to fulfil its mission
and led Rashid to conclude;
But when all is said and done the Council has generally failed to come up to
expectations (Rashid, JIMMA: 59).
Almost no one seems to have noticed the dilemma in state control: effective state control
necessitates an army of inspectors who are assumed to be honest individuals. After making
this heroic assumption, those advocating more and more state control through agencies each
with a fancier name than the other, tend to forget that there is a basic trade off between
controlling the waqfs and the fulfilment of their objectives. Since, these state agencies are
financed by the waqfs themselves, deducting more from their revenues in order to control
them becomes self defeating and simply leads waqfs to spend less on their primary objective;
charity. No one seems to think of improving the waqf system by granting them more, not less,
autonomy.

4. Taxation of Waqfs in India

Taxation of the waqfs has been one of the most controversial and complicated issues
in the history of the Indian waqf system. The basic dichotomy is the same as elsewhere: The
government is out to maximise its revenue, but taxing excessively leads to fall in revenues
that could have been spent on charity and so, is ultimately a self defeating affair. The issue is
also complicated by the existence of two different legal systems, Islamic and secular. What
was originally designed as a simple provision for totally exempting from tax the income of a
charitable trust has, over the years, become a maze of sections, provisos etc., with the result
that income tax officials are totally confused. The Income Tax Act was amended 27 times
between 1971-76. The state interferes and tries to regulate maintenance of accounts, receipt
of voluntary contributions, and the investment of trust funds. We wonder if there is any
other class of tax payers whose activities are so totally sought to be regulated (Diwan,
1992: 17).
Concerning the wealth tax, the Central Waqf Act promulgates that although a
mutawalli is not a trustee in the technical sense of the term, he has to be treated like one and
assessed for wealth tax in the same manner and to the same extent as would the person on
whose behalf the assets are held. Thus, as far as taxing the trustee/mutawalli is concerned,
the differences between the trustee in the English law where he is treated as an owner and the
mutawalli in Islamic law, where he is considered as a mere manager, have been disregarded
and the mutawalli is treated as the owner, i.e., in a manner more appropriate for a trustee.
Taxation of the awqaf was taken into consideration in a more systematic way in the
Income Tax Act, 1961. The basic points of this law are as follows: Income derived from
property held under trust for charitable or religious purposes is not assessed for tax if the
income is applied to such purposes in India.
As for the trusts held only in part for religious purposes; exemption from assessment
is given only to such trusts which were created before the commencement of the Act
(1.4.1962) and again provided the income is applied appropriately in India. Exempt income
must not exceed 25% of the income of the property held partially in trust.
This constitutes another restriction imposed by the 1961 Act. For, the 1922 Act had
provided exemption irrespective of whether the trust had been created before or after the
commencement of the Act and there was no ceiling prescribed. But, as part of the policy to
channel waqf revenues to the treasury, these restrictions are relaxed providing that the

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income so accumulated or set apart is invested in government securities or others approved
by the government. This is a manifestation for India of a universal and age-old tendency of
many states and governments to incorporate waqf revenues.
Subsection 3 of the Section 11 rules that any income, which is applied to purposes
other than charitable (i.e., the part reserved for the family), will be taxed. There is no change
here, as the same clause existed under the 1922 Act.
Section 13/clause b/sub-clause ii/category iii deals with the family waqfs (wakf-alalaulad) and is in direct conflict with Islamic law. It stipulates that those family waqfs created
after April 1, 1962 will not be exempt from income tax. Thus, our argument that in spite of
the Waqf Validating Act of 1913, there is still a lingering doubt about these waqfs is
confirmed. Such inconsistency does not exist under Islamic law, which does not distinguish
or discriminate between family and public waqfs.
Rashid suggests that at least the portion reserved for religious or public purposes
should be exempted from taxation. Concerning those religious trusts restricted for a
particular community, the fact that they are subject to taxation, is wrong for this policy
hinders their establishment. It has been argued with considerable justification that the small
loss of public revenue will be compensated by the more potent charitable institutions, which
assist the programme and objectives of a welfare state (Rashid and Husain, 1979: 85).
Moreover, income tax is not the only tax family waqfs are burdened with. They also
have to pay estate duty, once again, in direct conflict with the Islamic law. The High Court of
Bombay has held in Khatizabai v. Controller of Estate Duty that estate duty is leviable on
family waqf properties and not only on the portion which the settler had reserved for herself
for her life time but also on the portion of the estate she had given to her children, i.e., on the
entire corpus. This has led concerned Muslim jurists to protest:
Property of a waqf alal aulad (family waqf), according to the Muslim Law, is divine
property and therefore, res extra commercium. It is subject to the same restrictions as any
public waqfs, as Muslim Law treats both private and public waqfs alike The property in
both cases is inalienable and non-heritable and both fall under the supervision of the Kadi
Court. Section 5 of the Estate Duty Act therefore, does not appear prima facie to be
applicable (Rashid and Husain, 1979: 86).
It is clear that the judges in this particular case were affected by the provisions of the
English law. As far as the Estate Duty is concerned, the whole thing boils down to the
question of whether the property of a family waqf is transmitted to the next generation upon
the death of the founder. But in such a waqf both the founder and his descendants are merely
recipients of the usufruct of the corpus. They do not hold any absolute interest in the corpus.
It is because of these complications originating in the very philosophy of the Islamic waqf
system that the family waqfs should not be subjected to the Estate Duty. To attempt to do so
betrays a fundamental lack of understanding of Islamic law.
Meanwhile a debate has been initiated between those who are for exemption and
others against it. The basic points of this debate may be summarised as follows:
Arguments for Exemption:
a. Waqf is created in perpetuity and its property is vest in God. Imposition of estate duty will
result in the eventual liquidation of its corpus
b. The notion that a family waqf is just a private trust to which no sanctity need be attached
should be dispelled for good. Its objective will be better appreciated if it is remembered
that Islamic law emphasises redistribution of wealth as much as accumulation thereof.
Purely Islamic institutions; zakah and sadaqa assure further dispersal of wealth.
c. The ultimate objective of many of these waqfs is charity. So, it will be the charity itself,
which will be hit if taxation gradually finishes off the property.

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Arguments Against Exemption:
a. Exemption will favour only one section of the society and will thus be discriminatory.
This argument focuses on the highly complex structure of the Indian society and reflects
the concern of the lawmaker that if Muslim endowments are granted a tax exemption
privilege, this may lead to discontent among the Hindus.57 But Muslims were quick to
respond; they proposed that all endowments should be granted the same privileges.
b. If these waqfs are subject to income tax why should they be exempted from the estate
duty? This argument was countered as follows: There is a vital difference between these
taxes; while the former does not tend to extinguish the property, estate duty being a
capital levy on the principal value of the property, corpus, will eventually liquidate the
waqf itself. Moreover, Muslims argued; since waqfs are a creation of the Islamic law,
their sanctity and charitable character have to be judged under that law.
The bitter conflict between the revenue officials and sanctity of endowments has
been summarised by Paras Diwan in the following revealing words:
Tax exemption in the case of trusts is one thing, in the case of waqfs is another. Certain
institutions of Hindu and Muslim Law have proved such quicksands that once the revenue
authorities tread on them, they cannot extricate themselves from them and are sucked into the
crevices deeper and deeper. In regard to levying income tax or wealth tax on the waqf, a
somewhat curious and totally confused argument has been advanced. The argument runs
thus: the property of the waqf is tied in the ownership of God. But it is not owned by the
God in secular sense, since God, the almighty of Muslims is impersonal; it has no form (and
thus is not a juristic person as Hindu idol is). The mutawalli looks after the waqf as its
manager but the waqf properties do not vest in him. He is not a trustee as waqf properties
do not vest in him as they do in a trustee. Thus waqf properties cannot be assessed: And on
this argument it is immaterial whether waqf is public or private.
These words reflect the frustration of a non-Muslim scholar as well as revenue
officials. It is indeed not easy to tax waqfs without violating Islamic law. It is for this reason
that the position of the mutawalli assumes such importance in India, for it is through him that
the income tax is levied on the income of a waqf. More specifically in the Waqf Haji Karim
Bux v. CIT, the following 2 questions were referred to the High Court:

a.
b.

Whether a mutawalli could be treated as a trustee and can be assessed to tax under
section 21 of the Wealth Tax Act, 1957?
Whether, the Tribunal is justified in holding that the shares of the mutawallis were
indeterminate and therefore, not assessable.

Since in Islamic law the waqf property vests with God and not with the mutawalli,
the latter cannot be considered as a trustee in the English sense. He is more like a manager.
The mutawalli of a public waqf is a public official.
The mutawalli has the full power to use the waqf property for the purpose for which
the waqf was created. If the waqf deed authorises him to exercise istibdal, he can even
57

The Hindu piety found expression in gifts to idols and images, in gifts to maths and
other religious institutions. When properties are dedicated to a temple, the property
vests in the idol which is considered to be a juristic person. When dedication is made
to a math, the math itself is regarded as a juristic person, when dedication is made to
an institution, the institution is regarded as a juristic person. The shabait of the
temple, the mahant of the math, or the manager of the institution is not the person in
whom the property vests. He is not even the trustee, although he is answerable like a
trustee for mismanagement(Diwan, 1992: 7).

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alienate the waqf property. Istibdal is permitted in India: in Md.Usuf v. Md.Sadig, a waqf
deed provided for the sale of the waqf properties and to construct and maintain a rest house
from the sale proceeds at Mecca. The courts approved this.
The so-called EARC Report no.10, written in 1982 has observed that it should not be
the function of the tax department to monitor the functioning of the trusts and that the tax
laws are not meant to regulate the trusts. The authors suggest that there should be a uniform
and simplified law governing the religious endowments of all creeds. The sole effort of this
law should be to grant tax exemptions to the deserving institutions and to tax effectively
others, which are used as a devise to dodge taxes. We will observe whether these arguments
on the taxation of waqfs were translated into reality in the latest act, which came into force in
1995.
Having made these observations, the authors of the report touched upon a vitally
important issue in modern waqf management: establishment of joint-stock companies or
businesses by waqfs in order to enhance their revenues. The reader will recall that the ability
to establish joint-stock companies incorporated into the waqf was one of the primary reasons
behind the latest dynamism observed in the Turkish waqf system. This is because the waqf
with a company attached to it would be able to incorporate, if necessary, all of the latters
profits and thus enhance its revenues substantially. As for losses, since the company has its
own judicial personality, it can protect the waqf from liabilities towards third parties. In
short, the ability of a waqf to establish a company enables a waqf to achieve a dynamism that
it lacked before and at the same time it can be protected from liabilities towards third parties.
Viewed from the perspective of Islamic partnership law, this arrangement can be called a
two-layer mudaraba whereby, the waqf is the principal, rab-el mal, the company its agent,
mudarib, and the third parties with whom the agent (company) conducts its business need not
even know of the existence of the principal, i.e., there is a complete disjunction between the
principal and the third parties (Udovitch, 1970: 171, 238-42).58 We will now observe how the
same issue was addressed in India by the EARC committee.
While it is difficult to object in principle to a charitable trust either owning a
business or running a business itself, the question does arise as to the extent to which the
energies of such a trust should be devoted to such income raising activity without giving rise
to doubts about its essential character and their entitlement to tax exemption. Besides,
businesses attached to charitable trusts enjoying tax advantages would have unfair
competitive advantages vis a vis their competitors not attached to such institutions.
One possibility would be to determine a quantitative yardstick as to when the
business activity becomes so dominant in the affairs of a charitable trust as to give rise to a
legitimate question whether the organisation is in fact primarily a trust or a business concern
A judgement on merits in each case seems inescapable. But this sort of case-by-case
decision leads to inconsistencies and divergent decisions by the court. The best course would
therefore be to entrust the responsibility to give decisions in particular cases to a single
executive agency of government and to make those decisions final and binding (Diwan,
1992: 875).
Thus, the committee approached the whole issue with scepticism and doubt. Its
concern about the energies of the waqf being wasted in commercial activity is totally
unjustified in view of the fact that the company would have its own personnel and judicial
personality. However, its other concern about the waqf related businesses enjoying tax
exemption and thus causing unfair competition to others, appears to be correct.

The complete disjunction envisaged by Islamic law is not observed in Turkey, where
businesses established by waqfs do not have autonomous legal status. But nothing
stops a waqf from purchasing the shares of an already established company with legal
status, in which case, the disjunction applies.
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Meanwhile, it should be noted that before disassociating itself, the committee has
suggested that the decision should be based on the ratio of the business income to total
income of the trust. If this ratio exceeds 75%, then the entire income of the organisation
should be taxable. The committees main contribution may be summarised as follows: they
proposed to change the previous method of taxing a charitable trust. This method is based on
the notion that a charitable trust is tax exempt and leaves the government to decide whether a
trust (with all its activities) falls within the purview of a charitable trust. If it does, it will
be granted tax exemption on all of its income including the business. If the decision is
negative, the trust will have to pay tax on all of its income. What the committee has done is
to split a trusts income into two categories: business and non-business and subject the
former to taxation and grant exemption to the latter. Even the former may be granted
exemption on the condition that the government agency decides in favour and rules that the
business activity is incidental to the primary charitable activity of the trust. Thus, in a
nutshell, assuming that the business income to total income ratio is less than 75%, an Indian
waqf with a joint-stock company attached, would enjoy tax exemption (Diwan, 1992: 876).
As for the waqf-company linkage in the reverse direction, i.e., industrial
conglomerates establishing trusts, the committees opinion was, once again, based on deep
suspicion. More specifically, it was feared that industrial conglomerates would acquire the
control of other companies through the trusts that they establish. Thus, instead of focusing on
what well-financed waqfs could do for the society, the committee concentrated on the rivalry
between companies. As a result, a highly dynamic form of waqf finance applied successfully
in Turkey was obstructed in India.
5. The Waqf Act, 199559
The very latest legislation in India concerning the waqf system was passed in 1995.
The Waqf Act of 1954 which was thought of at the time as an excellent piece of legislation,
had brought, in reality, many difficulties and had to be amended in 1959, 1964 and in 1969.
In 1984 another Amendment Act was passed which made comprehensive changes. But this
Act also could not be enforced except for two of its provisions. The main criticism of this Act
was related to the provisions concerning the power of the Waqf Commissioner. It was stated
that the commissioner was given overriding powers and that the Waqf Board was made
subordinate to him. Moreover, the 1984 Act was correctly considered a gross interference by
the state and the central government in the day-to-day affairs of the waqfs and the
mutawallis.
These views suggest that the 1984 Act probably represents the peak of the Indian
waqf systems centralization. The 1995 Act seems to embody a reaction to this centralization.
Let us now observe to what extent this law can be considered as such.
The new Waqf Law has the following features: an interesting provision of the 1984
Act was the establishment of Waqf Tribunals ousting the jurisdiction of Civil Courts in
matters of waqf disputes. This provision finds a place in the new 1995 Act (Rashid, 1997:
14). The Waqf Boards have been reorganised so as to have 13 members. The majority of
these members will be elected from among the Muslim community. One particular criterion
for selection pertains to the mutawallis: trustees of those waqfs with an annual income of
greater than Rs. 1 lakh are eligible to be elected as Board members. Thus, individuals who
are actually running the waqfs are allowed to have a say in their administration.
The Waqf Commissioner who under the 1984 Act chaired the Board is now to be
called the Chief Executive Officer and will be subordinate to the Waqf Board. But when it
comes to basics, however, his powers are hardly curbed. Thus, the 1995 Act has turned out to

The Waqf Act 1995 (Lucknow: Eastern Book Co., 1995). This Act was published in
the Gazettee of India dated 22nd Nov., 1995.
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be as centralist as any other Act before it. Consequently, the arguments that a process of
decentralization has already started in the Indian waqf system should be taken with a grain of
salt.
The rate of contribution by the waqfs to the Board will be increased from six percent
of the annual income to seven percent. Thus, the funds, which belong to charity, have been
absorbed a little more into supporting the control mechanism.
Unlike the 1954 Act, which does not apply to various states, this new one will be
applied in all except Jammu and Kashmir.
Endowment of movables is once again confirmed in chapter one. This issue is tackled
further in chapter seven where it is promulgated that a mutawalli is permitted to lend money
belonging to the waqf, providing that there is an express provision in the waqf deed.
In the same section the validity of family waqfs are also reconfirmed, providing that
the ultimate purpose of the waqf is pious and charitable. This means of course, that once the
lineage of the founder expires, the waqf reverts to a pious or charitable use, which conforms
to the basic teachings of Islamic law.
In chapter two, state governments are granted authority to initiate and conduct waqf
surveys. In order to standardise the information gained from such surveys, the questions to be
asked are detailed. It is also specifically stated that the cost of the surveys will be met by the
waqfs the net annual income of which exceeds 500 rupees. The exact amount to be
contributed by each waqf, meeting this criterion, will be determined in proportion to the net
annual income accruing to such waqfs. Thus, we have another erosion of waqf funds
allocated to charity in the name of control.60
Further erosion occurs through support for another bureaucratic body, the so-called
Central Waqf Council. The purpose of this Council has been described, in chapter three, as
advising the government on matters concerning the working of the Waqf Boards and the due
administration of waqfs. The Council shall be financed as follows: Every Board shall pay
from its Waqf Fund annually to the Council 1% of the aggregate of the net annual income of
the waqfs. All such moneys received by the Council shall form a fund to be called the
Central Waqf Fund, which will be under the control of the Council.
Now that this new body has been established, there is a new need to audit its
accounts! These auditing costs shall be covered by the Central Waqf Fund. The power to
carry out the administration of waqfs is granted to the Central Government. It is interesting
that such power is granted to the Central Government rather than the State Governments,
indicating a continuation of centralization policy. It is stated furthermore that every such rule
shall be laid before each house of parliament and only if both houses agree, will it be
applied.
The State Governments, on the other hand, shall establish the Board of Waqfs and
appoint its members. A Chief Executive Officer (CEO) shall also be appointed who shall
have controlling function over the Boards. Thus we have a hierarchy of control emerging:

a. Boards to be established by the State Governments

b. The decisions of these Boards shall be executed by the CEO
c. Both the CEO and the Boards shall be answerable to the State Government
d. Finally, we have the Central Waqf Council, which advises the Central Government.
e.

Apparently, this hierarchy of control was deemed insufficient, for the Act also
promulgates that the Board may appoint an Executive Officer with supporting staff for any
waqf having a gross annual income of not less than 5 lakhs rupees. The function of the

By way of comparison, it might be noted that since American non-profit

organizations are not obliged to register, one can only guess their number, in all
likelyhood exceeding two million (Salamon and Anheier, 1997: 302).
60

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Executive Officer shall be to ensure that the budget of the waqf shall be submitted and the
accounts maintained. Thus we are left to wonder, if the Board appoints these executive
officers, what will be the status of the mutawalli himself, why will he be needed? Moreover,
we are also concerned that with so much hierarchy, Indian waqfs will simply be suffocated.
The 1995 law can, therefore, hardly be considered as an improvement.
The law has promulgated that the Boards shall also be responsible for sanctioning
any transfer of the property of a waqf by way of sale. The law has made these property
transfers quite difficult and subjected them to the condition that such istibdal transactions are
approved by at least 2/3 of the members of the Board. While the law has made istibdal
difficult, it has rendered the development of waqf property obligatory. It is promulgated that
if the Board considers a waqf property as suitable for development, it shall first ask the
mutawalli of the waqf to carry out this development and should he fail to do so in a given
time, will then, with the prior approval of the State Government, take over the property and
carry out the development itself. The Board shall use for such construction the funds of the
waqf or borrow credit on the security of the properties of the waqf concerned. The 1995 Act
also demands that all the waqfs shall be registered at the office of the Boards. Furthermore, it
is stipulated that all the trustees shall provide standard information when they apply for
registration.
Concerning the long-term lease of waqf properties, another controversial issue; a
lease of any period exceeding three years, notwithstanding anything contained in the waqf
deed, is void. Finally, we may add that the 1995 Act has not resolved the complicated tax
problems mentioned above.
To conclude; India constitutes a most interesting case as it was the first
country with a substantial Muslim population to have felt the massive impact of Western
ideas and rule. Direct and continuous British rule since the late eighteenth century has led to
the emergence of such idiosyncrasies as the Anglo-Muhammadan Law. Although we have
been critical above of many of the actions of the British in India and their blatant disregard of
the Islamic law, particularly concerning the permanent settlement and family waqfs, the
final victory of the Muslims led by Jinnah stands tall as attribute to British tolerance and rule
of law. It is therefore all the more telling that modernist Indian Muslims have been even more
radical in applying Western values than the British themselves. This point will also be
confirmed in the next section.
VIII. WAQFS IN PAKISTAN AND BANGLADESH
Since Pakistan was part of British India until the middle of the twentieth century, the
waqf system in this country preserved many of the characteristics of the situation in India.
Before April 1959 the following waqf acts were in force:

a. The Punjab Muslim Awqaf Act, 1951

b. The Qanoon-e-Awqaf Islami, 1945. (Former Bahwalpur State)
c. The North West Frontier Province Charitable Institution Act 1949
d. Mussalman Waqf Act (Sind Amendment), 1959
e. Mussalman Waqf Act (Bombay Amendment), 1935
In 1959 the Government of Punjab promulgated the West Pakistan Waqf Properties
Ordinance, which granted the government the right to dispossess a mutawalli. This was
followed in 1960 by the Awqaf Ordinance and West Pakistan Waqf Properties Rules, which
effected wholesale nationalisations. Thus, Pakistan also joined this universal trend.
According to the Rules, the endowments were to pass into the hands of the state in obvious
violation not only of the Islamic law but also of the Mussalman Waqf Validating Act, 1913
which, as we know, was one of the greatest achievements of the founder of Pakistan.

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The main motives for centralization of the waqfs were also similar to the rest of the
Islamic world. These motives can be summarised as follows:

a.
b.
c.

The administration wanted to control the religious elements in the country since waqfs
were often associated with religious activities
The state had an eye on the financial resources of the endowments
Centralization meant bureaucratisation of the religious establishment, which was thus
denied any opportunity for autonomy.

By the year 1984 a statistical analysis covering the provinces of Punjab, Sindh, North
West Frontier Province, Baluchistan and the Islamabad Capital Territory has revealed that
344 shrines, 648 mosques, 31,913 acres of culturable lands, 48,188 acres of unculturable
lands 2,215 shops, 1,869 houses had been nationalised (Malik, 1990: 72). Thus, the waqfs
were no longer available for the economic and social well being of the population. The
neglected and misused institutions from now on were to be looked after by the central and
provincial governments. The Kemalist perspective of the state was propagated in the schools
all over Pakistan:
The waqfs caused anti-social wastage of national wealth. They were misused by the pirs,
mutawallis, sajjadanashins and other parasites (Malik, 1990: 75).
As a rule, however, only profitable endowments were nationalised. The Waqf
Properties Ordinance, 1961 facilitated the take over of waqf property by an administrator
whose position and powers were strengthened by various legislations spread over almost a
decade. These individuals were called Administrator Awqaf. They were basically bureaucrats
without any religious background and were scarcely aware of the religious implications of
their positions. In this way, the authority of the Muslim saint was replaced by the anonymous
bureaucrat.
Up to Bhuttos time, nationalised endowments were organised on a provincial level.
But after 1971 they were put directly under the Central Government. In 1976 the Government
of Pakistan federalised all Provincial Awqaf Departments through the Awqaf Federal Control
Act. But this policy of centralization was short lived and the power was given back to the
provinces in 1979 by the Awqaf Federal Repeal Ordinance, 1979.
This Ordinance granted to the Administrator Awqaf of a province complete control
over the waqfs. Accordingly, he could now take over any endowment as defined by the
Repeal Ordinance without being in any way legally answerable. Section 20(2), moreover,
makes it possible to intervene in a waqf in order to preserve the sovereignty and integrity of
Pakistan.
Such government interventions, whatever may have been their cause, have naturally
provoked reaction. There were, indeed, a dozen appeals against interventions of the
Department, pursued all the way to the Supreme Court until the end of 1985. Of the 12
petitions, 9 were rejected and only 3 were taken up (Malik, 1990: 82). But the most
outspoken criticism of the government policy was voiced by the Council of Islamic Ideology
(CII), which protested the confiscations as being directly in opposition to the Islamic law. It
goes without saying that the CII demanded an immediate cancellation of the confiscations.
This was an answer to the enquiry of the government on the occasion of land reforms of
1972. The CII resolution suggested that the waqf estates were to be exempted from the land
reform. Provision for this was made way back in the Mussalman Waqf Validating Act, 1913.
These arguments, however, did not find any resonance in the government policies, which
wanted to limit the influence of waqf holders.
The government could afford to be highly inflexible thanks to a ruling of the Federal
Shariah Court (FSC), which it had set up in 1981. The FSC examined the Waqf Ordinance
of 1979 along with all the existing Acts and legitimised the nationalisation. Since, the FSC

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ruled that nationalisation was not against the Shariah it saw no reason to make any
suggestions to change the Ordinance. Section 16, which pertained to istibdal transactions was
considered to be justified as long as the original purpose of the waqf is continued to be
served. An examination of the details of these rulings has revealed that only one of the judges
in the FSC has spoken against the right of the government to acquire a waqf and that none of
the judges has referred to the Mussalman Waqf Validating Act, 1913 (Malik, 1990: 85).
The Awqaf Administration is also granted the right to change the curricula of the
religious schools run by the waqfs. After 1962 hundreds of waqf schools were brought under
the control of the Awqaf Department. Ever since that date state control has been expanding in
Pakistan. Following the schools, mosques were also tied up to the Department so that Friday
sermons are controlled by the administrators.
Subsequently, four different waqf ordinances were promulgated one each for the four
provinces in 1979. These provinces are: Punjab, Sind, N.W.F. Province, and Baluchistan.
The main objects of the Provincial Awqaf departments were:

a.

To take over the administration and control of the waqf properties in order to ensure better
management of the properties, to improve the standard of religious services and to ensure
that incomes are used for the original purposes
b. To enhance religious education.
The Awqaf Department has its own budget and is not subsidised by the state in three
of these provinces. Only in Baluchistan is subsidy provided as the number of waqfs there is
very small. The department is headed by a secretary to the provincial government (IRTI/IDB,
1987: 99-100).
Towards the end of the 1980s an increase in absolute terms in the receipts of the
waqfs has been observed. There is no reliable explanation for this. These figures may well
have been caused by the sale of some nationalised waqfs to the State Development Authority
and also by the return of some waqfs to their original mutawallis. These return transactions
were conducted in accordance with section 12 of the Regulation of 1961; section 16 of 1976
and 1979 and may be considered as a policy of reconciliation with the politically powerful
shrine holders. It is also possible that these awqaf may simply have been unprofitable.
In spite of a massive integration policy and all the attempts to curb the autonomy of
shrines and endowments, some of them still reflect political dissent and are refuge for
subcultures when some illegal activities are practised (Malik, 1990: 81).
Concerning the economic matters, it must be noted, first of all, that the receipts of the
Awqaf Department accrue from the following sources:

a. Cash boxes in shrines (About 50% of the annual income)

b. Income from gifts given in connection with vows etc. (15%)

c. Income from attached businesses (5%)

d. Income from rented urban properties (15%)
e. Income from rented agricultural land (10%).

Thus, we are informed that the waqf-company linkage we have emphasised above is of
marginal importance in Pakistan.
The total revenues collected from these sources over the long run exhibited the
following trend.
Table 5:
Increase in Real Total Revenue for the Awqaf Department Punjab
Year
Real Increase in Total Revenue
1965-66
83.0%
1970-71
96.7%
1975-76
-92.7%

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1980-81
1982-83
1983-84
1984-85
Source: Arranged from (Malik, 1990: 91).

49.5%
16.3%
-12.0%
5.1%

The great increase observed in the period 1965-71 has been explained by the
increasing nationalisation of the waqfs. After the 1980s stagnation in income is observed and
this has been attributed to the latent disapproval of the official policy. As for the relative
contribution to the overall budgets of endowments, it has been observed that in those regions
more extensively monetarised, cash box incomes tend to be high while in agrarian regions
rents from land tend to dominate. This is confirmed by the observation that the Lahore zone
contributes half of the total receipts of the Awqaf Department and bulk of these receipts are
cash box incomes.
As for the expenditure of the Awqaf Department, the salaries of the bureaucrats
constitute the most important category. These expenses have been rising from Rs 8,201,458
in 1983-84 to Rs 10,254,100 in 1985-86 thus leading us to observe that nationalisation of the
awqaf has simply led to a definite enrichment of the bureaucracy. Adding up other categories
for the administration, we reach a staggering figure of 57.6% of the total expenditure. Thus,
nationalisation has ended up diverting more than half of the total expenditure of the waqfs
from charities, their primary function, to the enrichment of the bureaucracy. We would
therefore be justified in calling this phenomenon a usurpation of the waqf funds by the state.
This argument is supported by the small amounts spent for education (merely 6.7% of the
total expenditure) and the declining expenditure on maintenance of historical waqf buildings.
As for health, only 11.7% of the total expenditure was allocated for this item. Based upon
these statistics, the Awqaf Department has been accused of dissolving the traditional social
structures and replacing them with nothing (Malik, 1990: 91-96).
To summarise the situation in Pakistan, in striking contradiction of the text of the
Mussalman Waqf Validating Act - 1913, which the father of the nation had pushed through
under the British, the independent state of Pakistan nationalised profitable waqfs in order to
further its own interests. In this process, the essential services that these waqfs used to
provide to the population have been blatantly dissipated and replaced with nothing. The
whole process has been bitterly criticised as a victory of the colonial sector which absorbs
autonomous waqfs, enriches itself, pushes through its ideology and legitimises all of this
through its own religious agents. (Malik, 1990: 97).
It has been reported that at the other end of the Indian sub-continent, in Bangladesh,
there are 12,579 registered waqfs. There are probably many more scattered all around the
country waiting to be registered. Some of these are several centuries old. The Eastern regions
have a greater number of waqfs. These are both purely charitable and family waqfs and most
are of mixed nature and so, a clear division is not possible. There are 10,000 mosques
maintained by awqaf. Of the madrasahs, 20% are also maintained by the awqaf. The waqfs
provide financial aid to more than 500 madrasahs and a good number of schools, orphanages
and charitable institutions. Waqf properties are comprised of both agricultural/non
agricultural land and urban lands. Many of the latter in Dhaka and Chittagong have been
developed into commercial centres.
Since Bangladesh was also part of British India, the Waqf Validating Act of 1913,
which permitted the family waqfs in India, was also valid in this country. In British Bengal,
the waqf estates used to be administered under the provisions of the personal law of the
Muslims and the Chief Kad of the district was the guardian of the awqaf under his
jurisdiction. But the district judge had no machinery to supervise or control the awqaf. The
Waqf Act of Bengal was passed in 1934 in order to remedy this situation and an autonomous
office headed by the Waqf Commissioner of Bengal was created. The political situation did
not permit centralised financing of this office and the Act stipulated that the expenditures of

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this office would be met by collecting contributions from the net income of the awqaf. The
whole purpose of the Act was to impose some control over the mutawallis.
When Pakistan was created, the Bengal Waqf Act of 1934 was adopted for East
Pakistan and was applied. In 1962 another law; the Awqaf Ordinance was enacted but the
1934 Act was not repealed. The 1962 Ordinance promulgated that in case there was a conflict
with any other law or enactment, the provisions of the Ordinance would prevail. The basic
changes made in the Ordinance of 1962 were the following: a uniform rate of waqf
contribution was fixed and the Waqf Commissioner became the Waqf Administrator with
quasi-judicial and administrative powers. These powers were the following:

a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.

Enrolling newly established waqfs

Appointing and removing the mutawallis
Settling waqf disputes
Investigating and determining the extent of the awqaf properties
Calling from time to time for information regarding the accounts and returns from the
mutawallis
Ensuring that the incomes generated by the awqaf are spent for the original purposes
Giving directions for the proper administration of the awqaf
Assuring the direct management of certain waqfs which, if necessary, he may take over
Fixing a remuneration for the mutawalli if the waqf deed does not make a provision
Investing any money received as compensation for the acquisition of waqf properties
under any law
Generally doing all such acts as may be necessary for the proper control, maintenance and
administration of awqaf.

The Awqaf Ordinance also provides for establishing a waqf committee at the national
level. The mutawallis were made responsible for the usual duties and if they failed in these,
they were subjected to a fine of up to Taka 2,000 or imprisonment of up to 6 months.
Originally the waqf administration was subject to the Ministry of Education but was
transferred to the Ministry of Land Reforms and Administration and finally to the Ministry of
Religious Affairs and Endowments. In Bangladesh, also, the waqf administration is highly
centralised. The inspectors (auditors) posted in the districts cannot pass any order or take any
decision. All the orders and the decisions are made by the Administrator at the headquarters.
The entire cost of the Administrator of Awqaf is met by the waqfs themselves with some
subsidies from the government. The latter are now provided regularly (IRTI/IDB, 1987: 8185).

IX. WAQFS IN MALAYSIA AND SINGAPORE

1. Introduction
The Malay states were colonised by European powers in the early sixteenth century
beginning with the conquest of Malacca by the Portuguese. The Portuguese were later on
replaced by the Dutch who were themselves replaced by the British. The colonial rule by
these powers came to an end in 1957 when independence was declared. Malaysia, today,
comprises of 13 states and federal territories and since every state has its own laws
concerning the waqfs, it is very difficult to view the Malaysian waqf system as a coherent
whole.
It has been asserted that four centuries long colonial rule has reduced Islam from
being a comprehensive mode of life into being merely a religious belief in Malaysia. The
secularist perspective that mundane matters of everyday life should not be influenced by
religion was put into practice by the British who confined the sultans authority to matters

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of religion and culture and took charge of general administration, security, law and order,
finance and education. It is only natural that the Malaysian waqf system should also be
affected by these developments.
Under the relentless pressure of Western colonialism and secularism, Malay Muslims
were seriously concerned about maintaining their religious beliefs and considered mosques as
centres of resistance. Mosque building and their maintenance through the waqfs, therefore,
assumed great importance. Consequently, it is not surprising that most Malay waqfs were
established for building and maintaining mosques and cemeteries and only rarely for
educational purposes (Alhabshi, 1987: 121).

2. Legal Issues
The forces at play elsewhere in the colonised Islamic world were also felt in
Malaysia. As in India, where the British desiring to establish private ownership of land had
introduced the well-known permanent settlement in 1793, in Malaysia also, the British
target was to introduce private ownership of land. This plan was put into practice in the year
1870, considerably later than in India, under the so-called Torrens system. This system
divided the entire land through cadastre surveys into privately held property. Each lot was
numbered and could be freely sold and bought and was subject to taxation.
In time, due to the Islamic law of inheritance, fragmentation occurred. Some owners,
realising the futility of managing such smallholdings, simply endowed these lands in the hope
of keeping them together and getting some benefits in the hereafter.61 In short, when
Malaysian Muslims realised their private land holdings were being excessively fragmented
they, like the Indian Muslims, resorted to the only way they knew and began to establish
family waqfs.
It goes without saying that the colonial policy in Malaysia also was to purchase the
fragmented land from the local landowners to form plantations. But formation of family
waqfs constituted a major impediment to land fragmentation and frustrated British attempts
to purchase land, hence the British hostility to these waqfs.
For the British, the way to remove the family waqf obstacle in Malaysia was already
well known. The 1894 Privy Council case (Abdulfata vs. Russomoy) in response to an appeal
from India had already declared family waqfs invalid. So, it was a simple matter to declare
the validity of this decision for Malaysia as well.
This was done in 1911, when the Waqf Prohibition Enactment was promulgated. The
Articles 3, 4 and 5 of the Enactment, 1911 directly targeted the inalienability of waqf lands
(Ibrahim, 1983: XIX). The impact of the enactment was as follows: while it preserved private
waqf lands, which were created prior to that date, the full ownership of these were now
deemed to be vested in their beneficiaries. In short, these waqf properties were divided
among the beneficiaries and thus converted into private ownership in conformity with the
general British policy described above. Meanwhile, section three forbade the freezing of
ownership of lands, thereby effectively prohibiting the establishment of any new waqf. Thus
with the introduction of the British rule, the Malay Muslims lost the freedom to declare their
lands waqf and this situation continued all the way until 1978 when this enactment was
finally repealed (Ibrahim, 1983: XIX, XX).
The whole process of declaring family waqfs null and void in Malaysia was based
upon the notion that the rulings of the Privy Council in response to appeals from India would
be valid for all the countries of the Common Wealth. Such an assumption constitutes an
Achilles heel in this controversy and Muslim jurists did not fail to concentrate their attack
precisely on this point. In other words, we have here the important question of whether there
was juridical unity in the British Empire and whether a decision of the Privy Council
pertaining to a certain region could be held valid elsewhere in the Empire.
61

Private discussion with Royal Professor Ungku Aziz, Feb.17, 1997.

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This is a difficult and a controversial problem. Professor Ahmad Ibrahim, a leading
Malaysian jurist, has criticised the Malaysian Federal Court, which held in at least two cases
in 1970 and in 1980 that the decisions of the Privy Council from India should be followed.62
The 1970 decision was based on the nineteenth century cases and had held that -

a. A waqf for the benefit of the settlors family, children and descendants and for charity
will only be valid if there is a substantial dedication of the property to charitable uses at
some period of time or other
Sheikh Muhammad Ahsanullah Chowdhry v. Amarchand Kundu (1889).
b. Such a waqf will not be valid if the primary object is for the aggrandisement of the
settlors family and the gift to charity is illusory either because of its small amount or its
uncertainty or remoteness of objective
Abdulfata v. Russomoy (1894)
In both of these cases the question was whether there was a valid charity or not. In still
another case Mujibinissa v. Abdul Rahim, Lord Robertson summed up the situation as
follows:
The waqf will be valid if the effect of the deed is to give the property in substance to
charitable uses. It will not be so if the effect is to give the property in substance to the
testators family.
In a 1951 case, Fatuma binte Mohamed bin Salim v. Mohamed bin Salim, The Privy Council
had again affirmed its 1894 decision on the famous Abdulfatas case that the scope of the
decision was not confined to India only. Lord Simonds, in this case, had held that
the experienced judges of the Court of Appeal for Eastern Africa did not doubt that on a
question of Muhammadan Law, decisions of the Privy Council in appeal from India must
bind them in appeals from the High Court in Zanzibar this was clearly the correct view
and that it must prevail also in appeals from Kenya.
Based upon the above, the Lord President (of the Federal Court of Malaysia) Azmi L.P.
ruled that Malaysian courts should also be bound by the judgement of the Privy Council in
response to an appeal from India.
But the issue is by no means settled. For, it has been held in many jurisdictions that
despite the views of Lord Simonds, the decisions of the Privy Council are not necessarily
binding in countries, other than that in which the appeal arose. Consider for instance, the
Ceylon Supreme Council case of Jane Nona v. Leo where it was ruled that a decision of the
Privy Council in an appeal from another country was a
non-binding Privy Council decision and does not have the force of a binding
authority in this country unless and until it is accepted by this court (Ibrahim, 1971:
VIII).
This implies that the decision of the Privy Council on the Abdulfata v. Russomoy
would be valid only for India and that the Privy Council can be regarded as a Malaysian court
only if it is hearing an appeal from Malaysia. If it is hearing an appeal from another
Commonwealth country, it is a court of that part of the Commonwealth and not a Malaysian
court (Ibrahim, 1971: VIII).

Commissioner for Religious Affairs v. Tengku Mariam (1970) and Haji Embong b.
Ibrahim v. Tengku Nik Maimunah (1980).
62

120
Furthermore, Ahmad Ibrahim has criticised the Federal Court for not attempting to
escape from subservience to the Privy Council and apply the pure Islamic law and texts.
According to Ibrahim, the Federal Court could and should have done so due to two sets of
reasons. First, the general reasons:

a.
b.
c.
d.

a.

b.
c.

d.

The Muslim law is administered in India in the ordinary courts and there are no separate
Shariah courts
In Malaysia, on the other hand, Muslim law (of the Shafii school) is the law of the land
and it is administered in the Shariah courts. This was confirmed in the Ramah v. Laton
case
Rulings on Muslim law can be given by the Mufti
Any ruling, shall, if the Majlis so determines or if his Highness the Sultan so directs, be
published by notification in the Gazette and shall thereupon be binding on all Muslims
resident in the state. And more specifically;
Whereas the Administration of Law Enactment of Trengganu (A state of the Malaysian
Federation) distinguishes between public waqfs, waqf am, and family waqfs, waqf khas,
(thus implicitly accepts the validity of both) the effect of the Privy Council decisions is
that only the former is valid and not the latter.
The Court should have treated with respect the fatwa issued by the Mufti of Trengganu, as
being the opinion of the highest Muslim legal official in Trengganu.
In spite of the views of the Privy Council where it was stated that the differences existing
among the Shafii and Hanafi and other sects has no present significance, there is a
difference between the Shafii and Hanafi views in the matter. . A Shafii waqf may be
created for the benefit of the beneficiaries, as a waqf khas, without ultimate dedication to
charity at all.
Islamic law is not interpreted in the same way in Malaysia as in India. As it is well known,
the Privy Council was dealing with waqf according to its own interpretation of the
Islamic law and not in reference to any special legislation dealing with waqfs.

Despite the above, the Federal Court chose to ignore the pure Islamic law and text
and decided to follow the law as developed in India. Ibrahim argues that the law could only
be corrected by legislation. This process of correction appears to have started in the early
1950s.
But the first significant correction was introduced by the Islamic Waqf Validating
Enactment, 1972. What the enactment did, however, was merely to declare that a waqf will
not be held invalid because:

a. The waqf is for the maintenance and support of the settlers family
b. In the case of the Hanafi sect, the waqf is for the founders maintenance and support for
c.
d.

his/her lifetime and for the payment of his/her debts provided that there is an ultimate
gift for the benefit of the poor
The ultimate benefits reserved for the poor is small or postponed until the total
extinction of the founders family
The waqf is for the benefit of the strangers, i.e., persons other than the family of the
founder.

Yet, despite the fact that family waqfs have been thus, at last legalised, the actual
establishment of a new family waqf has been made extremely difficult. Indeed, it is provided
in Selangor, Kelantan, Pahang, Negri Sembilan, Malacca, Penang and Kedah that every
family waqf, waqf khas, shall be void unless:

121

a.
b.

The ruler (in Malacca and Penang the Yang dafi-Pertuan Agong) shall have expressly
validated it or
It was made during a serious illness from which the maker subsequently died and was
made in writing by an instrument executed by him and witnessed by two adult Muslims
(the witness conditions are complicated and differ from state to state).

But even this incomplete law had some positive effects for Malaysian waqfs. For, the
Federal Court declared that the validity of a waqf must be determined with reference to the
Islamic Waqf Validating Enactment, 1972 and as intended by the Legislature, in accordance
with pure Islamic law uninfluenced by the English concepts of charitable trusts and the rules
against perpetuities. Thus, with the 1972 enactment, Malaysian courts were given the
authority to rule according to pure Islamic law.
It is precisely this point, which Ahmad Ibrahim finds so frustrating. For, although this
authority exists, the Federal Court, despite its own above-mentioned declaration, still chose
to examine the Indian cases. According to Ibrahim, the Federal Court seems to think that
pure Islamic law is embodied in the writings of the Indian jurists like Ameer Ali, Tyabji and
Fyzee as well as in the decisions of the Indian courts. This is, of course, not always true. For,
these jurists were authorities in what is known as Anglo-Muhammadan Law, a body of law,
as mentioned above, much influenced by British law. Ibrahim therefore demands that the
Federal Court of Malaysia should rely on the Islamic law and not the hybrid AngloMuhammadan law as developed in the Indian courts and in Privy Council. Ibrahim criticises
the civil courts of Malaysia as well, on the grounds that they do not give due respect to the
views of the Mufti and demands that such views deserve the same respect as that accorded to
the views of the Privy Council.
Thus, we deduce the following points from Ahmad Ibrahims work:

a. Malaysian courts are still under the influence of the British law
b. As far as Islamic affairs are concerned, the reference point is the decisions taken by Indian
c.
d.
e.
f.
g.

courts
The Indian courts, however, are known to have participated in the development of the
Anglo-Muhammadan law, which was in turn heavily influenced by the British law and the
decisions of the Privy Council
A reaction has set in. Leading jurists of Malaysia are questioning the validity of the
decisions of Indian courts for Malaysia and, more fundamentally, questioning the
legitimacy of the Anglo-Muhammadan law altogether
They demand that the decisions of the Muftis and pure Islamic law should be given the
same respect as the Privy Council decisions.
Though incomplete and criticised, the Islamic Waqf Validating Enactment of 1972
reconfirmed the legitimacy of the family waqfs in Malaysia (The original legitimisation
had occurred by a series of laws enacted during the fifties and sixties in various states).
Finally, a conflict between the Islamist jurists led by Ahmad Ibrahim and British trained
secularists seems to prevail in Malaysia. The Islamist view demanding the administration
of pure Islamic law in independent Islamic courts, implies a dual legal system. To what
extent such a dual system (Islamic and secular) can be applied with all of its
complications in a country populated by three distinct religious groups constitutes a
dilemma. Recent research has revealed however that, due to intense political pressure,
substantial progress has already been made and two parallel, relatively autonomous
systems have emerged (Horowitz, 1994: 236- 238).

3. Waqf Administration in Malaysia

122

Since the Prohibition Enactment 1911 was applied in most of the states of the
Malaysian Federation, by the time it was repealed in 1978, the modern Malaysian waqf
system was in shambles. Not only the system itself, but also the attitudes of the ordinary
Malay Muslims were negatively affected. The notion that waqfs could be an important agent
of economic change and the basis of economic prosperity had become totally alien to the
Malay Muslims. Muslims at all levels had come to consider that the waqfs were an ancient
and decadent institution mainly for the upkeep of the cemeteries and some mosques.
At the twilight of their rule in Malaya, the British dealt a final blow to the Malay
waqfs by initiating a process of massive centralization, which once started tended to continue
even after the independence with its own momentum. A series of laws enacted in the fifties
(Perak in 1951 and 1965; Selangor in 1952; Trengganu in 1955; Malacca in 1959; and Johor
in 1978) drastically centralised the Malaysian waqf system. Among the pertinent clauses the
following particularly attract attention:

a.
b.
c.
d.
e.

The Council of Islamic Religion or the Majlis Ugama Islam dan Adat Melayu is the sole
trustee of all waqf properties
All documents pertaining to waqf properties must be kept by the Council
The Council must take the necessary steps to transfer the ownership of all waqf properties
to itself
All moneys received from specific waqf properties must be used according to the purpose
for which such properties were intended
All moneys received from general waqf properties must be kept in the general fund of the
Majlis or Bait al-mal (Alhabshi, 1987: 123).

Steps have been taken to ensure that the ownership of all waqf properties is
transferred to the State Religious Councils but this is not a smooth process and some
difficulties are being encountered. The Councils are placed directly under the Sultan of each
state. In those states without sultans, the waqfs are put under the Yang Di Pertuan Agong, the
King.
The actual wording of the law includes the statement; Notwithstanding any
provision to the contrary, the Majlis shall be the sole trustee of all awqaf, whether waqf
khas (family waqfs) or waqf am (charitable waqfs). The expression notwithstanding any
provision means that despite the instructions in the waqf deed, the Majlis shall be the sole
trustee. Thus, in a dramatic move, the age old and universal institution of trusteeship,
mutawalli, appointed by the founder is simply eliminated. This argument is clarified in Perak,
where, the Control of Wakf Enactment, 1951, provides that the State Executive Council may
remove any trustee, appoint a new trustee or new trustees, or appoint the Majlis to administer
the trust of such waqf (Ibrahim, 1965: 287). Thus, it seems that the traditional mutawalli
appointed by the founder has been replaced by the Majlis or Majlis appointed individuals.
Moreover, the property affected by such trust, waqf or nazr am shall be vested in the
Majlis. The income of a family waqf, if received by the Majlis, shall be applied by it in
accordance with the lawful provisions of such waqf khas (Ibrahim, 1965: 283-85).
The income of every waqf shall be paid to and form part of the General Endowment
Fund or Bayt al-Mal which is administered by the Majlis. The capital property and assets of a
waqf shall not generally form part of the Bayt al mal but shall be applied in pursuance of
such waqfs and held as segregated funds. If over time it is no longer possible to carry out the
exact provisions of any waqf, the Majlis shall manage the waqf funds as close as possible to
the original purpose of the waqf or the Majlis may in such a case, with the approval of the
ruler, decide that such property and assets shall be added to and form part of the Bayt al mal.
All of the above indicate clearly the excessive degree of centralization that has taken
place in the Malaysian waqf system. The Majlis is declared to be the sole trustee for all the

123
waqfs, including the family waqfs; all the waqf properties are vested with the Majlis; and
separately held capital is supposed to finance the purpose of the awqaf. But how can this be
done if the income is collected by the Bayt al mal? This is reminiscent of the Ottoman
situation in the nineteenth century, with the Awqaf- Hmayun Nezareti collecting the waqf
revenues and redistributing 1/4 of these funds as aid to the awqaf. In fact, the picture is so
similar to the Ottoman application that it is as though the British Embassy in the Ottoman
Empire informed the British Government in India, which then applied the same measures in
British Malaya. Although, conjectural, this is a hypothesis worth examining.
Under these circumstances, the position of the mutawalli is also quite confused. It is
not even clear if this millennium old institution has disappeared altogether in Malaysia. If the
Majlis is declared to be the sole trustee of all the waqfs, including the family waqfs, what
indeed happens to the mutawalli? Although, the Johor Waqf Enactment Act (no.5) declares
that alienation of the waqf land is null and void and if any land is subjected to a waqf, the
usufruct thereof shall belong to the beneficiaries.
It is clear that the actual management of the waqf property is vested with the Majlis and not
with the mutawalli who was often a family member. Under these conditions of extreme
centralization, no wonder, the Muslims in Malaysia refuse to endow their properties as waqf.
Actually, there is further legislation centralising the system even more; it is decreed
for instance that the State Executive Council may provide for the powers to be given to the
Majlis to investigate any waqf and to call for the accounts of any waqf and to provide for the
offences for failure to supply accounts and cede possession of the assets of any waqf (Perak
Control of Wakaf Enactment , 1951, no.8).
In Malacca and Penang it is provided that all movable or immovable property that
was vested in the Muslim and Hindu Endowments Board before the commencement of the
Administration of Muslim Law Enactment shall now be vested in the Majlis, thus confirming
the above arguments for these states as well. All rights, duties, powers of the Muslim and
Hindu Endowments Board in respect of endowments in land or money given for the support
of any charitable purposes, shall be vested in the Majlis. (Malacca Administration of Muslim
Law of Enactment, AMLE, 1959, section 9; Penang, AMLE, 1959, section 9). These
legislations are also interesting in that they permit cash waqfs in Malaysia.
In
Singapore also an endowment is defined in sections 6/1 and 6/2 of the Administration Muslim
Law Act, 1968 as any endowment in land or money to be given in support of any Muslim
mosque or school or for charitable purposes, thus in effect legalising cash waqfs.63
Malacca appears to enjoy the best administrative set up. For, only in Malacca is it
possible to observe a specialised committee dealing with waqf affairs. In most states, there is
no such body and waqf affairs are left to the discretion of officials not properly trained in
waqf management. Statistics about the extent of waqf property are inadequate in all the
states. Moreover, since most waqf lands have been endowed for Muslim cemeteries, it has
been estimated that only ten percent of the waqf lands in Malaysia has income generating
potential (Alhabshi, 1987: 127). Most of the waqf properties that could generate income are
in the form of residential buildings and agricultural land. The former and urban waqf lands
have substantial rent yielding potential, however, this has been frustrated by the Rent Control
Act.
The Rent Control Act, 1948 froze the incomes of all waqf properties in Malaysia for
many years (Another legacy of the colonial rule, the Rent Control Act was formulated in
1948 and became effective in all the states from 1966. The rent controls are being abolished
only now, in 1996-97). Thus, with their basic revenues frozen, the Malaysian waqfs were also
hit financially. (Top, 1991: 59, 191).
Another reason why rents are so much lower than the market rates is long term
leasing (66 to 99 years). In fact, a strong correlation between the low rents and long term
leasing has been convincingly demonstrated by Othman Alhabshi (1987: Table 4).
63

For a concrete example of a Singaporean cash waqf see; (Ibrahim, 1965b: 46-47).

124
Moreover, in Malaysia it is possible to detect some discrimination against the waqfs
as well. For instance, whereas the local authorities have been exempted from the Rent
Control Act, the Majlis, which controls the waqfs, has been subjected to it. Consequently the
Majlis continues to receive from some of the properties it rents a monthly rent as low as RM
1.00!
Discrimination can be observed in the fiscal policy area as well: while waqf revenues
are subjected to all the restrictions of the Rent Control Acts, they are not given any tax
breaks. Indeed, with the exception of the cemeteries, all waqf lands are subject to land tax.
To add to the confusion, these tax rates are not uniform across the country. Under these
circumstances, we should not be surprised that in the state of Malacca, during the period
1985-89, the waqf system suffered a deficit (Top, 1991: 137).
Since in Malaysia there are three major ethnic groups, Malays, Chinese and Indian,
each believing in a different religion, the Rent Control Act had extra-ordinary repercussions.
This was because the land and the buildings (waqf properties) generally belonged to the
Muslims and the tenants were Chinese. Since, the Rent Control Act transferred a huge income
from the owners to the tenants, the situation was explosive. Nik Abdul Rashid b. Abdul
Majid has explained the situation in a dramatic statement:
If thirty years ago the Chinese rented waqf lands in Taiping at RM 1,00 per month,
thirty years later it was still RM 1,00. Within that period the Chinese tenants had
amassed millions of ringits of profits but our income on the waqf property remains
RM 1,00 (Top, 1991: 67).
These ridiculously low revenues are directly reflected in the Majlis budgets. The
Majlis of the Pulau Penang, for instance, could collect RM 325,000 as revenue and had to
spend RM 268,890. The arrears, moreover, amounted to RM 70,000. Thus the Majlis had
very limited means to spare for the development of the waqf properties it controlled.
Such development projects are usually financed by borrowing from the financial
institutions, which bring us directly to the highly important question on the relationship
between the waqfs and financial institutions. Although the Majlis of Penang has borrowed
successfully from the Malaysian Development Bank (MDB) and also from the Majlis
Amanah Rakyat (MARA or the Council of Trust for the Indigenous, Bumiputra, People), a
combined total of RM 7.5 millions, it failed to borrow from the Islamic Bank. The details of
these transactions are as follows:

a.
b.

The Majlis borrowed RM 5 millions from the MDB at 5% interest. This amount was
borrowed for erecting a 7 storey building on waqf land
The Majlis also borrowed RM 2.5 millions from the MARA for erecting another building
on waqf land. There was no interest involved, but the Majlis had to agree to mortgage the
waqf land to MARA for 30 years. This transaction was completed and the building was
erected which yielded total monthly revenue of RM 13,200.

When the Majlis wanted to free this building from MARAs mortgage, it approached
the Islamic bank. MARA was asking RM 5 million for the original RM 2.5 millions it had
invested. So, the Majlis decided to approach the Islamic bank and ask them for a loan. The
bank agreed to buy the building from MARA for RM 5 millions but demanded from the
Majlis RM 11 millions. The Majlis was supposed to make a down payment of RM 183,333
and pay the rest to the Islamic bank in monthly instalments of RM 61,112 for 180 months.
The Majlis was quick to reach to the conclusion that the Islamic bank was asking a 120%
profit and decided to cancel any relationship that it might have had in the future with this
interest free bank (Abdel Rahman, 1997: 14; Top, 1991: 141).
This frustrating experience the Majlis had with the Islamic bank is all the more
striking if we consider the fact that the Malaysian waqfs are indirect shareholders of this

125
bank because the revenues collected by the religious departments, which are partially
constituted by waqf revenues, have been invested in the Islamic Bank Malaysia and the
Takaful Co.. To be more precise, 25% of the equity of the Islamic Bank Malaysia is owned
by the religious departments of various states. As for the Takaful Company, of the total paid
up capital of RM 10 million, half was owned in 1991 by the religious departments (Top,
1991: 141). Furthermore, the Islamic Religious Council has been a significant investor with
the Islamic Bank Malaysia; it has deposited M$ 1,065,500 into the investment account of the
Islamic bank. These frustrating experiences aside, some successful ventures have also been
brought to conclusion and waqf lands have been profitably developed by funds provided by
MARA (Alhabshi, 1987: 134). All in all, the Majlis, in comparison with the Islamic bank, has
enjoyed a better relationship with MARA.
The federal structure of Malaysia also presents certain problems for waqf
management: Each state has different problems stemming from different size, quantity of
waqf properties etc. Given these differences, 5 major problem areas common to all the states
have been identified. These are:

a. The objectives and the functions of the administrators are not clear
b. The organisational structure is inefficient
c. Waqf officers are not properly trained
d. Lack of concrete plans and actions to develop waqf properties
e. Lack of financial support to implement waqf projects (Ngah, 1992: 39-40).
That all of the above have hindered the endowment of waqfs by Malay Muslims is
demonstrated by research, which has shown that most waqf lands in the state of Johor belong
to the state. The implication is clear; Muslims of Johor rarely constitute waqfs on an
individual basis. This is a striking conclusion for a state where the great sultans of Johor had
once endowed huge estates and thus provided an example to ordinary citizens.64 Therefore
the culprit cannot be the Muslims of Johor but rather the impact of colonialism,
secularisation, and the waqf system that has discouraged Muslims from endowing their
properties. To these reasons we may also add the high cost of land that imposes a substantial
opportunity cost upon the founders.
But serious discouragement to waqf endowment can also be found in the procedure
as well. For instance, in Selangor, Negri Sembilan, Kelantan, Trengganu, Pahang, Malacca,
Penang and Kedah, it is provided that a waqf cannot encompass more than one third of the
property (unless in Kelantan it is sanctioned and validated by the ruler, or in Trengganu it is
sanctioned and validated by all beneficiaries) (Gordon, 1975: 282). In this way, the amount
of property a founder may wish to endow is limited to only one third of his/her total property.
It goes without saying that this rule clearly violates the basic principles of Islamic waqf law
and is yet another relic of the British influence.
Another important impediment pertains to the illegal settlements in waqf lands.
When such settlements do occur, there is little co-operation between the trustee, the Majlis,
and the authorities. In the state of Johor, the Enactment for the Administration of Religious
Affairs, Johor, no. 14/78, section 50 charges illegal intruders and settlers into the waqf
property a maximum fine of RM 1,000 or six months of imprisonment (Top, 1991: 179).
Since illegal settlements continuously occur, it is clear that these measures are not sufficient.
A well-known example of such an illegal settlement in waqf property occurred in Penang.
The so-called Wakaf Kampong Makam with its seven acres of land in the middle of George
Town had been illegally settled. The Majlis of Penang reacted to this situation and ordered

The so-called Alsagoff concession was bestowed by the late Maharajah Abubakr
upon Syed Muhammad b. Ahmad b. Abdul Rahman Alsagoff, first, in 1878 and then
again in 1888. See, (Ibrahim, 1983: xix-xx).
64

126
the settlers to move out. Due to the lack of co-operation between the authorities, this order
was not obeyed by the settlers. As a result, the Majlis has not been able to develop this
property as it was originally planned (Abdel Rahman, 1997: 8).
Shifting our attention to Singapore, we observe the same centralising tendencies
there and note that there is a Muslim and Hindu Endowments Board constituted under the
previous Muslim and Hindu Endowments Ordinance to administer certain Muslim religious
endowments. The Minister may order any waqf to be administered by the Board where it
appears to him that,

a) Any waqf has been mismanaged

b) There are no trustees appointed
c) It would otherwise be to the advantage of any waqf that it should be administered by the
Board.

The Board has all the powers of a trustee and may appoint or remove any officer of the waqf,
receive and collect the income of the endowment. The Board is also given power to require
the production of accounts from the trustees or any person who has possession, custody or
control of the funds, money or property of any endowment, and has power to require such
trustee or persons to appear before the Board and be examined on oath or otherwise.
Thus, in Singapore we have a slightly different situation, rather than eliminating the
traditional mutawalli altogether, section 58 (4) of the Administration of Muslim Law Act,
1968 allows the trustees appointed by the founder in the deed of endowment to continue to
function, but at the same time confirms the power of the Majlis Ugama Islam Singapura,
(MUIS) to appoint and remove any existing trustees. This difference regarding the status of
the mutawallis between Singapore and Malaysia is also confirmed by Ahmad Ibrahim:
The majority of the mosques in Singapore are still administered by trustees under
trusts created by wills and (in) this respect (their) position in Singapore differs
from that in the States of Malaya, where it is provided that the Majlis Ugama Islam
shall be deemed to be the trustee of all mosques (Ibrahim, 1965: 47).
An actual court case from the Court of Appeal of Singapore may illustrate how these
rules and regulations are actually translated into practice. The case we will refer to is known
as the Trustees of the Estate of M. Haji Meera Hussain v. MUIS. The case concerns a waqf
endowed by a certain Abdul Rahman b. Muhammad Yunoos, a resident of Singapore, who
made his last will in India and died there on 13 October, 1918. The deceased had certain
properties in Singapore and he stated in his will that the revenue from these properties should
be spent for the upkeep of a mosque in India. In time, a large part of the testators estate was
lost and only a share in a property in 34 Arab Street remained. This was apparently not
sufficient for the maintenance of the mosque in India. Bearing this in mind, the trustees
appealed for permission to sell the property in order to construct a new mosque in India.
Although this was approved by the Commissioner of Charities, the MUIS opposed
the sale on the grounds that the properties constituting a waqf would automatically be vested
in MUIS according to the Administration of Muslim Law Act, 1968, (Cap.3)(the Act). The
trial Judge agreed with the respondents and ruled that since the property was vested with
MUIS, the appellants had no power of sale. The appellants appealed against this decision.
The case was then referred to the Singapore Court of Appeal and is known as Civil
Appeal No.134 of 1994. The court dismissed the appeal and thereby confirmed the
respondents claim that since the property of the waqf was automatically vested in MUIS, the
appellants had no legal title or right to sell the property other than to carry out the waqf as
directed under the will. The request to sell the property was also rejected on the grounds that
the founder had prohibited istibdal in the waqf deed. This actual court case from Singapore
reveals the following points:

127

a.
b.
c.
d.

It is possible to endow property in Singapore and use its usufruct for the support of a
mosque in India
Since the foundation of the endowment, several generations of trustees have been
appointed to run the waqf
These mutawallis were permitted to administer the waqf. This permission was also
confirmed by the Singapore Court of Appeal showing that the office of trusteeship is
considerably more clear in Singapore than in Malaysia
But the mutawallis were not permitted to sell the property both because istibdal was not
permitted by the founder but also, and primarily, because the property of the waqf was
vested not with the trustees but with MUIS. This point is almost identical to the situation
in Malaysia.

To sum up, Malaysia constitutes a fascinating case for the history of waqfs. This is a
country where Islamic law was superseded by secular British law, and the waqfs remained
dormant for long periods. Moreover, Muslims constitute only about half of the total
population. These historical facts notwithstanding, in independent Malaysia Muslims began
to challenge British law and insist to be ruled by their own law and institutions. The country
is giving birth to a dual legal system. Under these circumstances it is to be expected that the
country should go through a thorough waqf reform.

X. WAQFS IN THE PHILIPPINES

It is well known that Islam was introduced into the Philippines as early as the
thirteenth century by Muslim merchants and was embraced particularly in the southern
islands of Sulu and Mindanao. The Islam that emerged in these far away territories was a
mixture of pre-Islamic usage and local custom with the basic teachings of Islam. A strict
application of the Islamic law did not take place.
The Spanish conquest appears to have had little impact on the Muslim sultanates of
Sulu and Mindanao (Barra, 1988). The relative autonomy that these sultanates enjoyed came
to an end when the islands were ceded to the United States in 1898. The American policy
towards the Muslims was governed by the need to respect their religious freedom. This
policy found its official expression in the Universal Declaration of Human Rights passed by
the United Nations in 1948. During the American occupation the waqfs were left entirely to
the discretion of the Muslim community. There was not a single legislative enactment
designed to administer the waqfs. Thus we do not observe in the American occupied
Philippines the harmful impacts of the French or British colonialism on the waqf system. It
will be argued here that this difference is due to the way the mother countries viewed their
own foundations and the third sector. While a comparative assessment of the policies towards
the foundations in Britain, France and the United States, would fall beyond the scope of this
book, it is well known that the American policy was the most lenient (Salamon and Anheier,
1997; Archambault, 1997; Kendall and Knapp, 1996). The fact that we do not observe in the
Philippines the harsh state interference that we have observed in the French and British
colonies is not accidental, but rather, a reflection of the American attitudes towards the
foundations.
After the independence, the Marcos administration attempted to have the Islamic
personal laws codified. This was considered to be an essential step towards reconciliation
with the Muslims of the Philippines. For this purpose a research group was established. The
group was ordered:

a.

To survey, and collect materials on Islamic law particularly as they related to the current
Philippine laws.

128

b. To reconcile Philippine laws with Islamic law

c. To prepare a draft of the proposed Code of Philippine Muslim Laws65
Although the committee did some work on the law of the waqfs, their
recommendations were not included in the final draft. This was because the waqfs were
considered to violate the basic secularist principle: the separation of the church and the state.
The Code was signed into law on February 4, 1977 with the chapter on waqf laws missing.
Consequently, the policy of benign neglect continued even after the independence.
With this minimal government interference, the Muslims of the Philippines were left
free to establish their own waqfs according to their own customs and beliefs. Presently, waqf
establishment is subject to the Philippine Corporation Law, a secular body of law adopted
during the American occupation. Property rights, on the other hand, are governed by the
Philippine Civil Code, a reproduction of the Spanish Code. There are also few pertinent
Articles in the Code of Muslim Personal Law. These pertain to the establishment of
testamentary waqfs, waqf bil wasiyya.
The Islamic Trust and Development Foundation aims to promote waqf establishment
among the Muslims. Meanwhile, attempts to centralise can also be observed in the
Philippines. The so-called Markazos Shabab Al-Muslim fil-Filibin, a voluntary organisation
of the conservative Muslims of the Lanao province, for instance, acts as the sole
administrator of the waqf properties. The Muslims are encouraged to make their donations to
the Markazos that uses these funds to construct and maintain the mosques, schools and other
charitable institutions. The Markazos has also been able to attract cash funds from the rich
donators of the Middle East. The Markazos limits its activities strictly to the public/charitable
foundations. It also functions as a know-how centre for the donators. In a land where waqf
establishment is not a wide spread tradition, this is obviously a crucial service. The Markazos
provides the founders with waqf deeds in conformity with the Islamic law. In return for these
services, the founders are required to furnish financial statements twice a year.
Charitable institutions have been granted generous tax exemption by the Philippine
government. Providing that the institution is purely charitable and is registered with the
Securities and Exchange Commission as a charitable institution, the tax exemption is
complete. Such institutions are also not subject to the labour laws nor have the industrial
courts jurisdiction over these institutions. The family waqfs, on the other hand, are not
granted tax-exemption, as they are not considered charitable. The law considers these
institutions as joint-stock companies. This is obviously a secular argument and conflicts with
Islamic law.
The best-known example of a family waqf is Jamiatul Philippine al-Islamiyah
established by a prominent family in Marawi City. It has established the only Islamic
university in the country populated exclusively by Muslim students. Since part of the net
income accrues to the founders family, the waqf does not enjoy tax-exemption. The waqf
has juridical personality and is managed by a board that is chaired by the eldest son of the
founder. The Jamiatul Philippine constitutes an exception: there are very few other family
waqfs in the Philippines (Gamon, 1999).
XI. CONCLUSION
In this book an attempt has been made to highlight the basic forces and trends that
affected the history of waqfs in the Islamic world. Throughout our inquiries, we have been
impressed by the incredible universality and resilience of this institution. No less impressive
also was the fact that notwithstanding the vast distances and different schools of thought

Alizaman D. Gamon Management of the Waqfs in the Philippines (Kuala

Lumpur: ISTAC, unpublished research paper, 1999), p. 4, based upon Memorandum
Order No.370, Office of the President, August 13, 1973.
65

129
prevailing in the Islamic world, the institution of waqf was governed everywhere by basically
the same principles. The differences were decidedly of minor importance. The problems were
also basically the same: agency problem, a major area of research in modern microeconomics, was observed in all the waqf systems throughout history.
Another constant in the history of the waqfs appears to have been the complexity of
the relationship between this institution and the state. While, on the one hand, the rulers
founded the greatest waqfs in nearly all the countries and often utilised them as public policy
instruments, on the other, many of them exhibited a relentless hostility towards this
institution. The reasons behind this hostility may have assumed different forms over time and
space but the hostility, itself, has remained a constant. It is therefore all the more remarkable
that this institution has managed to survive.
The hostility of the state towards the waqfs assumed a new dimension with the
advent of colonialism. Both the British and French colonial powers were hostile to the waqfs.
While, due to the space and time restrictions we have concentrated on the British influence, it
has been shown that the French were even more hostile than the British. Moreover, this
hostility was based on the same principles and took in practice very much the same forms
(Powers, 1989: 535-571). The arguments that the European powers were jealous of the
Islamic waqf system and simply wanted to destroy an institution that they could not control,
which prevented them from acquiring land etc., should be taken with a grain of salt. Europe
had its own foundations borrowed from the Islamic world during the Crusades and chose to
destroy them during the age of enlightenment. Thus the European powers were not applying
double standards, they were simply trying to project their own ideology on to the Islamic
world.
The colonial hostility that sought an outright prohibition of the waqfs, was
supported by the indigenous modernists persuaded by the former. The combination of these
two forces was formidable and, thanks to the modernists, the hostility continued and was
even enhanced, after the colonial epoch.
It is ironical that although European states have gradually abandoned their hostility
towards the foundations since the beginning of the twentieth century and recently, after the
failure of the welfare state, have even begun to provide substantial support to the so-called
non-profit sector, modernists in the Islamic world cling to the eighteenth century European
views and continue to undermine the waqfs. Thus by a curious twist of fate, in the Islamic
world, modernists have become conservatives. This conservatism is most unfortunate and the
modernists urgently need to re-examine their positions.
Both the magnificent Islamic tradition and the latest developments in the West point
out the need for a thorough waqf reform. The conditio sine qua non for such a reform,
however, is knowledge. That is, knowledge about the evolution of this institution in Islamic
world, as well as in the West, plus a thorough understanding of the latest developments in
both civilisations. It is hoped that this book has contributed towards the former. As for the
latter, that is, an assessment of the historical evolution as well as the latest developments in
the West, this will constitute the subject of a future volume.

130
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146
GLOSSARY:
Brief descriptions of terms used in the text are given here. For further details the reader is
referred to the following sources: Halil Inalck, Introduction to Ottoman Metrology, in H.
Inalck, Studies in Ottoman Social and Economic History, (London: Variorum, 1985); id..and
D. Quataert, An Economic and Social History of the Ottoman Empire (Cambridge:
Cambridge University Press, 1994); A. Udovitch, Partnership and Profit in Medieval Islam,
(Princeton: Princeton University Press, 1970); Mehmet Zeki Pakaln, Tarih Deyimleri ve
Terimleri Szl , (Istanbul: Milli E itim Basmevi, 1971), 3 volumes; Joseph Schacht, An
Introduction to Islamic law (Oxford: Clarendon Press, 1982); Charles Issawi, The Economic
History of the Middle East, 1800-1914 (Chicago: The University of Chicago Press, 1966)
amme waqfs:public endowments
urfi taxes: Taxes based upon dues confirmed by the sultan. Taxes based upon custom.
Ahli waqfs: Family waqfs
alal aulad: Indian family waqfs.
al-Azhar: Probably the most famous Islamic University in Cairo.
Amir al-Hajj: An officer in charge of the pilgrimage
askeri: Member of the elite, member of the military corps.
asl al-mal: principal, original capital of an endowment or partnership.
asliye court: Primary court
avarz: Extra-ordinary levies, tax-units
bayt al-mal: Public treasury
bidaah: Informal collaboration in which one party entrusts his capital to the care of an agent
who returns the proceeds of the transaction to the original owner without any compensation,
commission or profit.
bonyad or bunyad: Waqfs in Iran.( usually post revolutionary).
ceteris paribus: Holding everything else constant.
conditio sine qua non: Absolutely necessary condition.
corpus: principal, original capital of an endowment.
Dergh- muall: The great gate of, usually, a palace; palace of the Ottoman Sultan.
dervish: Member of an Islamic order.
Devadar (devatdar): A person who holds divit ( a box which contains ink and an ink pen) in
his hand. A clerk, an official. In Mamluk Egypt a high ranking official of the waqf system.
divan: Imperial Council which functioned as the government and the Supreme Court
dnm: A measure of land; 919,30 sq.m. in Ottoman and 1,000 sq.m. during the Republican
era, in Turkey.
tatiste: State dominated
fatwa (fatawa pl.): Opinions, response, on a point of Islamic law.
feddan: 1. Egyptian measure of an area. Until the nineteenth century it was equal to 6,368
sq.m. But after the Muhammad Ali reforms it was reduced to 4,201 sq.m. The feddan is
divided into 24 qirats of 175 sq.m. each.
2. In Syria an area that can be plowed in a day by a team of oxen.
guberniia: An administrative zone in the former Soviet Union.
Habs or habous: Synonym of waqf used particularly in North Africa.
haddam: Cleaning and maintenance staff.
hadith: Prophetic traditions, sayings of Prophet Muhammad.
hakim: Judge
haremeyn: Holy places of Islam, usually used for Mecca and Medina only.
Hassa- Hmayn: 1. Belonging to the sultan
2. Prebents belonging to the sultan.
hayri (khayri): Charitable
Hujjat al-Islam: A member of the Islamic clergy.

147
Iane: Aid.
ibdal: Sale (of a waqf property).
icareteyn: Ottoman double rent endowments.
Ijma: Consensus
imam: 1.Muslim who leads the prayer.
2. Leader
imambarah:A place for religious congregation for the Shiites.
irade- seniye: An order issued by the Ottoman Sultan.
ishhad: Declaration.
istibdal: Exchanging waqf property against another property or cash.
istiglal: Providing loan against the security of a house.
istihsan: 1. Juristic preference
2. Approval, a discretionary opinion in breach of strict analogy.
istishab: A method of legal reasoning particular to the Shafii school and to the Twelver
Shiites.
Jacobinisme: 1. Jacobins were the most radical group among the French revolutionaries
1790-4 associated with Robespierre.
2. General term used for extreme radicals.
jagirdari: Indian (Mughal) land holder.
jarib (toprak ls): Measure of land used in India.
jehad: Islamic holy war.
Jizya: A discriminatory poll-tax imposed upon a non-Muslim adult.
Kad (Qadi): Judge
khaliseh: Lands belonging to the ruler.
kharaj: land-tax
khums: One-fifth
lex salica: The legal code of the Salian Franks.
Lugares de monte: public bonds issued in Rome
Madad- maash: Regular stipend recipients in Mughal India.
madrasah: See Medrese.
Majlis Ugama Islam dan Adat Melayu: 1. A central authority of the waqf system in
Malaysia 2. General trustee of all the waqfs in Malaysia
Majlis Ugama Islam Singapura: Central waqf authority in Singapore.
mal: assets, property.
masjid: Small mosque
mazbut: An endowment whose management has been taken over by the central authority
(Ottoman term).
medrese: Islamic college
Mevlid: Chanting in celebration of the birth of the Prophet.
mihrab: Part of the mosque reserved for the imam during the prayers.
minber: An elevated place in a mosque reserved for the person who reads the Friday sermon.
Molla: Learned person, a teacher of Islam.
mudaraba: Partnership of capital and entrepreneurship.
mudiriyet: Directorship
Muezzin: Caller to prayer.
mufti: A specialist in Islamic law who gives an authoritative opinion.
mujtahid: A highly qualified jurist who can reach conclusions using his own reasoning.
mukarrername: Renewal of a permission or privilege.
mlhak: An endowment managed by its own founder or a trustee appointed by the former.
mltezim: Ottoman tax-farmer (of the iltizam system).
Muqarasa: Agricultural partnership
Musha: joint, undivided, ownership.

148
Musharaka al-mutanakisa: A modern method of finance practiced by Islamic banks
particularly for financing construction projects.
mustoufi: A waqf officer.
mutawalli: Trustee
Nazir al-Ahbas: Waqf official in Mamluk Egypt
Nzr- Evkaf: Minister of Endowments.
nazr am: A type of endowment in Malaysia
nesl: Generation.
nzl: A tax, in kind, imposed by the Ottoman State on fiscal housholds.
r: A tax, usually one-tenth.
Parganas: An administrative unit in India.
primogeniture: A wide-spread system of inheritance observed particularly in England and
Western Europe whereby the eldest son of the family acquires the family land.
qanat: Irrigation system wide-spread particularly in Iran and Afghanistan.
qirat: 1. Shares in Carati partnership 2. Measure of land in Egypt.
qiyas: Analogy
rab al-mal: Principal in a partnership.
Raqaba: 1. Eminent domain
2. State or sultanic ownership of land.
reaya: Peasantry (Ottoman).
res extra commercium: Excluded from commerce
riba: Interest, usury.
Ryot: Peasantry (India).
sadaqah: Alms, charity.
sadaqah jariyah: Ongoing charity.
Sadr: Administrator in Indian waqf system, inspectors.
Sarraf: Money changer, eventually the term was also used for a banker.
sawab: Good deeds.
sayyid: A person who claims to belong to the Prophets lineage.
selatin waqfs: Sultanic waqfs.
Shariah: Islamic jurisprudence
Shaykh al-Islam ( eyhlislam): Highest officer of religious matters in the Ottoman Empire.
sheykh: Notable.
shirkat al-Islam: Islamic company
Soyurgal: Mughal land grants.
sunnah: 1. Precedent 2. Normative legal custom 3. Actual deeds of the Prophet
taamul: Custom
taaruf: Custom
takaful: Islamic insurance
takyas: Religious orders in Malaysia
tapu: title deed.
tasarruf: Possession rights on a state owned land.
tekke: A place of meeting for the members of an Islamic order.
tezkere: Official statement
tuman : Persian monetary unit
tmar: Ottoman fief
ulama: Religious scholars of Islam
vakfname: Endowment deed.
waqf am: Public waqf
waqf khas: Family waqf
Yargtay: Supreme Court of Appeal in Turkey.
Zamindaris: Mughal feudal land holder.
zawiya: Minor Islamic centre, usually smaller than tekke.

149
zakah: Obligatory Islamic (tax ?), one of the five pillars of Islam.

150
GENERAL INDEX:
Abd al-Hamid Abd al-Haqq:
Abdel Hadi, Sumaiya Sid Ahmed
Abdel Rahman, Mohd. Zain b.
Alluba Pasha:
Abbasid:
Abdlhamid I:
Abu Hurairah:
Abu Bakar, Khatijah Shaik
Abussuud Efendi: See, Ebussuud.
Abuzahra, M.:
Abyssinia:
Act for the Administration of Islamic law:
Aden:
Afghan:
Africa, North:
Africa, South:
Afshar:
Aghnides, N.P.:
Agrarian Reform Law:
Ahbas al-mebrure:
ahli:
Ahmad ibn Hanbal:
Akgndz, A.:
Akgndz, H.
Akhavi, S.:
Akkoyunlu:
Alp Arslan:
al- Turabi:
al-Ansari:
al-Azhar:
al-Bijindi:
al-Bukhari:
Aleppo:
Alexandria:
Algeria:
Al-Habshi, S.O.:
al-Kafi:
al-Mazandarani:
al-Muizz:
al-Muqnia:
al-Quds:
al-Quhistani:
al-Ramli:
Alsagoff & Co.:
al-Sarakhsi:
al-Tirmidhi, S.:
al-Zahidi:
al-Zarqa:
Allgemeine Landrecht
AMAL:
Ameer Ali, Syed:
American:

151
Amsterdam:
amwal al-badal:
analogy:
Anatolia:
Anavatan Partisi:
Anderson, J.N.D.:
Andra Pradesh:
Anglo-French:
Anglo-Muhammadan Law:
Anheier, H.
Ankara:
Ankara University:
Anwar Sadat:
aql:
Arab:
Arab provinces:
Arabic:
Arabs, pre-Islamic:
Archambault. E.
Arjomand, S.A.
askeri:
Assam:
Astan-e Qods-e Razawi:
A kPashazade:
Atlantic:
Avallone, P.
awqaf al-ahli:
awqaf al-hukmiye:
awqaf- gayri sahiha:
Aydn:
Aydn, Davut.
Azerbeycan:
Baer, G.:
BaGDWd:
Bahr:
Bahr al-Raiq:
Balkans:
Ballar, S.
Balo lu, Z.:
Baluchistan:
Bangladesh:
bank:
Bank, Ottoman :
bankruptcy:
banks, Western:
Barber, K.T.:
Barkan, .L:
Barnes, J.R.:
Barra, H.
Barton:
Bates, R.H.:
Bayezid II:
Baykal, K.:

152
Bayt al-mal:
Bayt- Timur:
Behrens-Abuseif:
Bellr-Hann, I.
beneficiary:
Bengal Waqf Act:
Bengal, British:
Beykoz:
Bhutto:
bidaa:
Bihar:
Bilici, F.:
Blaisdell:
Bolak, A.:
Bombay:
bonds:
borrower:
borrowing:
British:
British Empire:
British, Vice-Consul:
Buddhist:
budget deficit:
Bulaq:
bunyad (bonyad):
Burhan al-Din Ibrahim:
Bursa:
Buyid:
Bker, Semih.
Byzantine:
a atay:
Cairo:
Calcutta:
Calcutta College:
capital:
capital accumulation:
capital market:
capital pooling:
capital pooling, demand side:
capital pooling, supply side:
capitalism:
cash waqf inspection registers:
cash waqf, controversy:
cash waqfs:
cash waqfs, diffusion of:
Cattan:
Cengiz Han (Chingiz Khan):
census:
Central Asia:
Central Waqf Act:
Central Waqf Administration:
centralization:
etin, H.

153
Chaliphate, Ottoman:
Chardin:
charitability:
charity:
Chinese:
Chittagong:
Christian:
church:
Civil Code, Iranian:
civilization:
izaka, M.:
cloth factory:
Cobb-Webb theorem:
coffee trade:
Coing, H.
coins:
collateral:
colonialists:
colonisation:
Committee for the Abolishment of the Waqfs:
Communist:
companies:
confiscation:
Constantinople:
consumers surplus
controversy:
corpus:
corruption:
Crecelius, D.:
credit:
Crimea:
Crimean War:
crowding-out effect:
Crusade:
Crusaders:
Cuno, K.:
CWA (Central Waqf Administration):
Cyprus
Dagestan:
Dakka:
Damietta:
Dardir:
Defterdar:
Delhi:
Delhi Sultanate:
Dergh- mulla:
devadar:
dinars:
Directorate of Endowed Money:
dirhams:
Divan al-ahbas:
Diwan, P.:
Diyanet Vakf:

154
dominium eminence:
Dndren, H.:
Dongala al-Aguz:
Duncan-Jones, R.:
Durr al-Muntaqa:
Duyn-u Umumiye:
Dzhahlilov,A.:
East India Co.:
Ebussuud (Abussuud) Efendi:
Edirne:
education:
Edward I:
Egypt:
Eldem, E.:
Eldem, V.:
elite:
Elizabeth:
employment:
endowment, deed of :
England:
England, Chancellor of:
entrepreneur:
epidemic:
Erzincan:
Esener, T.
tatiste:
eunuch:
Europe:
European:
Evkaf- Hmayn Nezareti:
factor prices:
factors of production:
family:
famine:
Farah Diba:
Faroqhi, S:
fatawa Qadi Khan:
Fatimid:
Fatimid Egypt:
fatwa:
Fayzee:
fiddei commissum:
Financial Protectorate:
First World War:
fiscal policy:
food:
Ford Foundation
Ford Motor Co.
forests:
foundations:
founder:
Franciscan Friars:
Franks, Salian:

155
Frederick Arthur Stanley:
free ride:
French Empire:
French Revolution:
Frenkel, Y.:
Friedman, M.A.
fructus:
Fustat:
Fuwa:
Gamon, A.
Gaudiosi, M.
Gazi Ahmet Muhtar Pasha, Fieldmarshall:
General Numeiri:
Gerber, H:
Geremek, B.:
German:
Germany:
Gezira:
GDW:
Ghayat al-Bayan:
Ghazne:
Gordon, S.:
government:
government borrowing:
government expenditure:
Gozalo, M.B.
grain:
Great Awqaf Company:
great powers:
Greece:
growth:
Gujarat:
Gulf States:
habs:
hadith:
Hajj, Endowments and Charity Affairs Organisation, of Iran:
Hanaf:
Hanbali:
Haneef, M.A.:
haremeyn:
Harun al-Rashid:
hassa- hmayun:
Hatemi, H.:
hayri:
health:
Hejaz (Hijaz):
Hejaz Railway
Henry VIII:
Heywood, C.
Hill:
Hindu:
Hodgson:
Hoexter, M.

156
Holy Land:
Hong Kong:
Horowitz, D.:
Hospitalers:
hudud:
Hujjat al-Islam:
Hlagu:
Husain, A.:
Hussainabad:
Ibadullah Vakf:
ibdal:
Ibn Batuta:
Ibn Khaldun:
Ibn Nujaym:
Ibn Tulun:
Ibrahim, A.:
Ibrahim, Z.:
icareteyn:
ijmaa:
ijtihad fi:
lhanls (Il-Khanid):
Imam Abu Yusuf (Eb Yusuf):
Imam Muhammad (al-Shaybani):
Imam Muslim:
Imam Riza:
Imam Shafii:
Imam Zufar:
imambarah:
immovable:
Imperialism, Western:
nalck, H.:
income:
income distribution:
income redistribution:
India:
India, British:
Indian, Muslims:
inflation:
inheritors:
inns of court:
inspection registers:
institutions, non market:
interest, economic:
investment:
Ip irli, M.:
iqta:
irade- seniye:
Iran:
Iran, Islamic Republic of:
Iraq:
irrevocable:
IRTI/IDB:
Isfahan:

157
Iskender Pasha:
Islamic Bank, Malaysia:
Islamic Charity-Waqf Law, 1970:
Islamic civilisation:
Islamic economics:
Islamic economists:
Islamic empire:
Islamic fundamentalism:
Islamic heritage:
Islamic inheritance:
Islamic jurisprudence:
Islamic Salvation Revolution, of Sudan:
Islamic society:
Islamic state:
Islamic world:
Islamo lu, Huri
Ismail, MaGDW:
Istanbul:
istibdal:
istiglal:
istihsan:
istishab:
istisna:
I eri, N.:
janissaries:
jehad:
Jerusalem:
Jewish:
Jinnah, Muhammad Ali:
jizya:
Johansen, B.:
Johore:
joint-stock company:
Jones, W.R.:
jurisprudence:
jurists:
kad:
K tba , .:
Kahf. M.
Karakoyunlu:
Karbala:
Karnataka:
Kashmir:
Kastamonu:
Kayseri:
Kazan:
Kazgan, H.:
Kedah:
kefil:
Kemalist Jacobinisme:
Kendall, J.
Kenya:
Kepel, G.:

158
Kerala:
Khalid ibn al-Walid:
Kharaj:
Khartoum:
Khayat, H.A.:
Khaybar:
khayri:
Khedive:
Khomeini:
Khorasan:
khums:
King Faruq:
Kra, C.
Knapp, M.
Knights Templars:
Ko E itim Vakf:
Ko Foundation:
Ko, R.
Ko, V.
Kocahano lu, O.S.:
Koi Bey:
Konya:
Kprl, F:
Kordofan:
Kozlowski:
Kreiser, K.
Kulayni:
Kurt, I.
Lahore:
Lambton, A.K.S.:
land reform:
Land Reform Bonds:
Land Reform Committee:
Land Reform, Egypt:
Lapidus, I. M.:
Latifi:
Latin:
Laum,
Law of Endowments:
Law of inheritance:
Law of Inheritance, 1943:
Law of the Unity of Education:
Law, Germanic:
Law, Roman:
Lebanese Law:
Lebanon:
Lelantan:
lettre patent
Lex Salica:
Liberal Constitutionalist Party:
liberalism:
Lions Club:
loan:

159
Lord Cornwallis:
Lord Robertson:
Lord Simmons:
Lucknow:
lugares de monte
marudat:
Madhhya Pradesh:
Madras:
madrasah:
Mahdi:
Mahdi, Mahmoud Ahmad:
mahkamat al-tasarrufat:
Mahmud II:
Mahmud, of Ghazne:
Mahmut Pasha Vakf:
Majallah: See Mecelle.
Majer, H.G.
Majlis Agama Islam (MAI):
Majlis Amanah Rakiyat (MARA):
Majlis Ugama Islam Singapore (MUIS):
Majma al-Anhur:
Makdisi,G.:
Makrizi:
Malacca:
Malay World:
Malaysia:
Malaysian Development Bank:
Malik, S.J.:
Maliki:
Maliye:
Malthus:
Mamluks:
Mandaville, J.:
Manh:
Manhat al-Khaliq:
Marathawada:
markets:
Marseille, Chamber of Commerce:
Martin Luther:
Mashhad:
masjid:
Masters, B.:
Mawlawi:
Mazandarani:
mazbut:
McChesney:
Mecca:
Mecelle:
medieval:
Medina:
medrese:
merchant:
Merton College:

160
Merton, d. W. :
Mesopotamia:
mevlid:
Middle East:
mihrab:
millet:
Mill Gvenlik Kurulu:
minber:
Ministry of Awqaf:
Ministry of Education:
Ministry of Finance:
Ministry of Interior:
Ministry of the Imperial Endowments:
Muhammad Ali:
Mohd. Zain, b.A.R.:
monastries:
money:
Mongols:
Morocco
mortgage:
mosques:
Mostafawi, M.T.:
Moussavi, A K.:
movables:
mudaraba:
Mudawwana:
Mufid:
Mufti:
Mughal India:
Mughals:
Muhammed Ali evki Bey:
Muhit:
mlhak:
mlk:
mltezim:
Mundell-Laffer Hypothesis:
municipal:
muqarasa:
murabaha:
Musa Saffeti Pasha:
musha:
Muslim and Hindu Endowment Board:
Muslim World:
Muslimin Trust Fund Association Singapore:
Muslims:
Muslims, Indian:
Mussalman Waqf Validating Act:
Mustafa III:
Mustafa Kemal Atatrk:
mutawalli:
Nadir Shah:
Nafiz Pasha:
Najaf:

161
Nasser:
National Security Council:
NATO:
Nawab:
Nazir al-Ahbas:
Nazr- evkaf:
nazr am:
Negri Sembilan:
nesl:
Ngah, K.:
Nile:
Nisapur:
Nizam al-Mlk
North West Frontier Province:
Nukud-u Mevkfe Mdrl :
O uz:
Omar (umar), the Second Caliph:
Omdurman:
mer Hilmi Efendi:
opportunity cost:
Orders of the Templars:
Orenburg:
Orhan Gazi:
Orientalists, French:
Orissa:
orphanage:
Othman, M.Z.b.H.:
r(ushr):
Ottoman archives:
Ottoman army:
Ottoman Catholics:
Ottoman courts:
Ottoman, economic history:
Ottoman economy:
Ottoman Empire:
Ottoman Orthodoxes:
Ottoman, proto-pseudo-socialist system:
ownership:
Oxford:
ztrk, N.:
Pacific:
Pahang:
Pahlawi:
Pakistan:
Paris:
Peoples Party:
Perak:
Peri, O.:
Persekutuan:
pilgrimage:
poor laws:
population:
possession:

162
Powers, D.S.:
primogeniture:
Prince Umar Tusun:
private sector:
Privy Council:
producers surplus
profit:
property:
Prophet:
Prophet Muhammad:
Prophetic traditions:
provision:
provisioning:
provisionism:
Prusa:
Public Debt Administration:
public goods:
Pulau Penang:
Punjab:
Qajar:
qirat:
qiyas:
Quataert, D.:
Queen Victoria:
Qumm:
Quran:
Quran, modernity of:
Quran, the message of:
Qureshi, M.A.:
Radd al-Mukhtar:
rakaba:
raqaba:
Rashid, K.S.:
rate of interest:
Raymond. A.:
real estate waqf:
reaya:
religion:
Religious Protectorate:
Rent Control Act:
rente:
revenue:
riba:
riot:
Rockwell, J.C.:
Rome:
Rosetta:
Rostovtzeff, (Rostowzew), M.:
rule against perpetuities:
Rumeli:
Russia:
Rfa:
Sabah:

163
sadaqah:
sadaqah jariya:
Sadeq, A.M.:
Sadr- e-Sabah:
Sadr us Sudur:
Sadr-e-Sarkar:
Safavid:
Sa lam, N.
Saint Francis:
Sakurzada, E.:
Salahaddin Ayyubid:
Salamon, L.
salary:
Samanid:
Sanjar:
Santiago De Los Espanoles
sarraf:
Sasanid:
saver:
sawab:
Sawad:
Saygn, M.
Sayyid:
Sazman-e Eqtesad-e Islami:
Schacht, J.:
securities:
security:
Selangor:
selatin vakflar:
Seluk Empire:
Selim:
separatism:
services:
Shafii:
Shah Abbas II:
Shah Ismail:
Shah Reza:
Shanghai:
shares:
Sharh al-Wahbaniyyah:
Sharh Manafi al-Daqqaq:
Shariah:
Shaykh Muhammad Bakhit:
Sheraton:
Shiite:
shirkat al-esham:
shrine:
silk:
Sind:
Singapore:
Sinnar:
Sipahsalar:
Sir John Malcolm:

164
Sir W. Commerpethersan:
Sir William Jones:
Siyar:
Siyar al-kabir:
slaves:
Sokullu Mehmet Pasha:
Soviet:
Soviet Union:
spice trade:
state:
state interference:
state policy:
state sector:
state, size of:
state, the wrath of:
stocks:
Stber, G:
Sbktigin:
Sucesk, A.:
Sudan:
Sudan, National Islamic Front:
Sudan, of Condominium:
Suez:
Suhrawardi:
Suhrawardy, A.:
Sleyman, the Magnificient:
Sleymaniye Mosque:
sultan:
Sultan Abdulhamid:
Sultan Abu Bakar:
Sultan Aladdin:
Sultan al-Ghuri:
Sultan Barkuk:
Sultan Mehmet II:
Sultan Tuqlaq:
sultanic waqf:
sunna:
sunni:
surety:
Syria:
taamul:
taamul alam:
taaruf:
Taavone Keshvarzi Bank:
Tabung Haji:
Tadhkirat al-Muluk:
Tahrir:
Tahtawi:
Taiping:
Taj Mahal:
takaful:
Tamil Nadu:
Tanzimat:

165
tapu:
Tarabulsi:
tasarruf:
Tashkent:
tax:
tax, avarz:
tax, nzl:
tax, shari :
tax, urfi:
taxation:
tax-farmer:
technology:
technology, agricultural:
Teheran:
tekke:
Ten conditions:
tenants:
Tevhidi Tedrisat Kanunu:
tezkere:
The Bengal Regulation:
the Permanent Settlement:
eyhlislam:
eyhun, A.:
ura-i Devlet:
Third Sector Foundation (TSEV)
Timurid:
Timurta :
Toepler:
Top, N.Md.:
Torrens System:
Trablusgarb:
tradition:
transmission, legal institutions of:
treasury:
Treaty of Berin:
Treaty of London:
Treaty of Paris:
Trengganu:
trustee:
trusts, English:
trusts, South African:
Tunesia:
Tunis:
Turkestan:
Turkey:
Turkic World :
Turkish Civil Law:
Turkish Republic:
Turkoman:
Tusi:
Tyabji:
Tmar:
Trnova:

166
Udovitch, A.:
Ufa:
Ulema:
Ungku Aziz:
Ural-Volga:
use:
ushr:
usufruct:
Usul, .
usury:
usus:
Utyabay-Kerimi:
Uzbek:
Uzbekistan:
VakflarBankas:
Vakfname:
Vehbi Ko:
Wanniski, J.
Waqaf Kampong makam:
waqf:
Waqf Act of 1995:
Waqf for the Promotion of Turkish Armed Forces (WPTAF):
waqf of government securities, stocks and bonds:
waqf of grain ships:
waqf of medicine:
waqf of slaves:
waqf of trees:
waqf of woollen cloths:
Warburg, G.
wealth:
West Bengal:
West Pakistan:
women:
Yegar, M.:
Yemen:
Yener, S.:
Zaimzade Hasan Fehmi Bey:
Zamindaris:
zawiya:
zakah:
Ziraat Bankas: