The Islamic Calendar, which is based purely on lunar cycles, was first introduced in 638 CE by the companions of the Prophet, sallallahu alayhi wasallam, and the second Khalifah, Umar ibnul Khattab (r.a.) (592-644 CE).
He did it in an attempt to rationalize the various, at times conflicting, dating systems used during his time. Umar consulted with his advisors from the companions on the starting date of the new Muslim calendar. It was finally agreed that the most appropriate reference point for the Islamic calendar was the Hijrah, the incident of the immigration of the Muslims from Makkah to Madinah. It is a central historical event of early Islam that led to the foundation of the first Muslim city-state, a turning point in Islamic and world history. The actual starting date for the calendar was chosen (on the basis of purely lunar years, counting backwards) to be the first day of the first month (1 Muharram) of the year of the Hijrah. The Islamic (Hijri) calendar (with dates that fall within the Muslim Era) came to be abbreviated by some as AH in Western languages from the latinized Anno Hegirae, "in the year of the Hegira". Muharram 1, 1 AH therefore corresponds to July 16, 622 CE.
The Islamic year consists of twelve (purely lunar) months. They are: Muharram, Safar, Rabi'ul Awwal, Rabi'uth Thani, Jumada al-Awwal, Jumada ath-Thani, Rajab, Sha'ban, Ramadhan, Shawwal, Thul Qi'dah, and THUL HIJJAH. Some of the most important dates in the Islamic year are: 1 Muharram (Islamic new year); 1 Ramadhan (first day of fasting); 1 Shawwal (Eidul Fitr); 8-10 Thul Hijjah (the Hajj to Makkah); and 10 Thul Hijjah (Eidul Adh-ha).
To Muslims, the Hijri calendar is more than a sentimental system of time reckoning, and dating important religious events. Many of the marital and spousal relationship rulings of the women are directly connected to the lunar (Islamic) months. The Hijri calendar, therefore, has a much deeper religious and historical significance in the Muslim life. Muhammad Ilyas in his book, "A Model Guide to Astronomical Calculations of Islamic Calendar, Times & Qiblah", quoted Abul Hassan an-Nadwi who wrote, "It (the advent of the 15th Islamic century) is indeed, a unique occasion to ponder that the Islamic Era did not start with the victories of Islamic wars, nor with the birth or death of the Prophet, sallallahu alayhi wasallam, nor with the Revelation itself. It starts with Hijra, or the sacrifice for the cause of Truth and for the preservation of the Revelation. It was a divinely inspired selection. Allah wanted to teach Man that the struggle between Truth and Evil is eternal. The Islamic year reminds Muslims not of the pomp and glory of Islam but of itssacrifice, and prepares them to do the same." From a historical angle, Ilyas quoted Samiullah who wrote, "All the events of Islamic history, especially those that took place during the life of the Prophet, sallallahu alayhi wasallam, and afterwards are quoted in the Hijra calendar era. But our calculations in the Gregorian calendar keep us away from those events and happenings, which are pregnant of admonitory lessons and guiding instructions. ...And this chronological study is possible only by adopting the Hijri calendar to indicate the year and the lunar month in line with our cherished traditions."
Muslims are obliged to use the Islamic calendar because all of the rulings needing time tracking are related to it. They should use a calendar with 12 lunar months without intercalation as evident from the following verses of the Qur'an:
*"They ask you about the New Moons, say they are but signs to mark fixed periods of time in (the affairs of) men and for Hajj."* [11:189]
*"The number of months in the sight of Allah is twelve (in a year) so ordained by Him the day He created the heavens and the earth. Of them four are sacred; that is the straight usage so wrong not yourselves therein, and fight the pagans."* [9:36]
*"Verily the transposing (of a prohibited month) is an addition to unbelief: the non-believers are led to wrong thereby: for they make it lawful one year, and forbidden another year, of months forbidden by Allah and make such forbidden ones lawful. The evil of their course seems pleasing to them. But Allah guides not those who reject Faith."* [9:37]