It's now on much debate among both Muslims and even non Muslims whether Female Genital Mutilation is legal in Islam or not. The straight forward answer is it's not allowed. It was prevalent in some Arab countries and even in countries where people adopted Islam during 7th century AD, but as people came to know about Islam they stopped following this ritual but still some countries like Sudan and North East African countries follows this not so good ritual.
This ritual of Female Genital mutilation again came into limelight after the ISIS head Abu bakr Al Baghdadi, from Iraq ordered the women and girls to go through this ritual and asked to practice it from now on. This order of ISIS head was affecting 4 million females of Iraq.
After coming to know about this kind of orders from Al Baghdadi many scholars from all over the world criticised it and has set fatwa against the practicing or adopting of any such ritual in Islam, it's strongly prohibited to follow any such ritual which doesn't have any reference in Quran, Hadiths and valid Islamic books.