Hiba-Bil-Iwaz: A Peculiar Concept In Mohammedan Personal Law

A hiba-bil-iwaz is a peculiar concept in Mohammedan personal law. Hiba literally translates to gift and iwaz means consideration; so hiba-bil-iwaz means a gift for consideration. As distinguished from a hiba or simple gift, is a gift for consideration. it has all the elements of a sale, but is still characterized as a gift under Muslim law; but in reality it is a sale. Accordingly, possession is not required to complete the transfer, as it is in the case of a hiba, and an undivided share in property capable of division may be lawfully transferred by hiba-bil-iwaz, although it cannot be permitted in case of any other hiba.
In this kind of hiba, a gift has been duly made and completed and subsequently, the done also gives something to the
actual payment of consideration (iwaz) by the donee and a bona fide intention on the part of the donor to divest his interest in favour of the donee.
This type of transaction was evolved in India by Muslim lawyers to circumvent the difficulty of making a gift of mushaa (undivided interest in property), which is capable of division. As per the general rule of hiba, an undivided share in divisible property cannot be transferred. There would have to be a division and delivery of possession of the divided part. To avoid this, the hiba-bil-iwaz was devised.
This paper will discuss the meaning of hiba-bil-iwaz along with its essential conditions, the validity as a gift and sale and some case laws discussing the
Although it is governed by principles of Muslim law, in case of any dispute, courts in India are required to apply principles of Indian statutory law. However, the complicated nature of the transaction has led to several difficulties in its interpretation. The general view of courts in order to determine the nature of any transaction is to look at the intentions of the parties to the transaction. But despite this, the Madhya Pradesh High Court, in the case of Mohammad Iqbal Khan & Ors. v. Late Manzoor Ahmad Khan & Ors., which is the latest judgement on the issue, distinguished between a simple hiba or gift and a hiba-bil-iwaz and stated that in reality the transaction was a sale. In furtherance of this position, the Bench held that as the value of the property, the subject-matter of the hiba-bil-iwaz, was more than ₹100, it must be effected by a registered instrument, otherwise it will be considered invalid. The Supreme Court however, has not had a chance to examine the nature of a hiba-bil-iwaz and the last case before the Hon’ble SC regarding such a transaction dates back to