Laws of Trade
Mufti Abu Muhammad Ali Asghar Attari Madani
Falsely advertising gold and selling it
Question: What do the scholars of Islam say regarding the following: some shopkeepers buy jewellery from manufacturers. The latter have 20.5 carat gold but claim it is 21 carats, and the shopkeeper is aware of this. In this scenario, is it correct for the shopkeeper to advertise the gold as 21 carats and sell it to customers?
اَلْجَوَابُ بِعَوْنِ الْمَلِکِ الْوَھَّابِ اَللّٰھُمَّ ھِدَایَۃَ الْحَقِّ وَالصَّوَابِ
Answer: In the described scenario, advertising and selling 20.5 carat gold as 21 carats is a lie. This is impermissible. The shopkeeper must tell customers the correct purity of the gold or it is a violation of their rights, as lower carat gold is cheaper.
There is a narration in Ṣaḥīḥ Muslim prohibiting deception:
من غشنا فلیس منا
Whoever acts dishonestly towards us is not of us.[1]
وَاللہُ اَعْلَمُ عَزَّوَجَلَّ وَ رَسُوْلُہٗ اَعْلَم صلَّی اللہ علیہ واٰلہٖ وسلَّم
Buying from online platforms
Question: What do the scholars of Islam say regarding the following: when we buy items from online platforms, we do not know if the seller possesses the goods at the time of selling. Are our purchases permissible in this case?
اَلْجَوَابُ بِعَوْنِ الْمَلِکِ الْوَھَّابِ اَللّٰھُمَّ ھِدَایَۃَ الْحَقِّ وَالصَّوَابِ
Answer: Buying from online platforms is permissible. Whether or not the seller possesses the items when selling is not enough to nullify a transaction. It is impermissible to buy from an online platform, however, in which the seller himself does not have ownership of the goods he sells.
Shaykh Taftāzānī رَحْمَةُ الـلّٰـهِ عَـلَيْه writes in Sharḥ ul-Talwīḥ:
الاصل في العقود هو الانعقاد والجواز اذلم توضع في الشرع الا لذلك
The basis of transactions is agreement and permissibility, as Islamic law introduced them for these purposes. As long as a corrupting factor is not certain to us, a contract will not be nullified due to doubt.
He also said:
انه لا يثبت بالشك
Nullification is not established through doubt.[2]
Abū al-MaꜤāli writes:
لا یثبت الفساد بالشک والاحتمال
Doubt does not prove corruption.[3]
وَاللہُ اَعْلَمُ عَزَّوَجَلَّ وَ رَسُوْلُہٗ اَعْلَم صلَّی اللہ علیہ واٰلہٖ وسلَّم
Buying gold, keeping profit, and selling it to save oneself from interest
Question: What do the scholars of Islam say regarding the following. A man wishes to take a loan from me and I wish to make profit. He asked for £200,000, so I bought gold of that value and he will purchase it from me for £230,000 over a period of time. Is this method correct?
اَلْجَوَابُ بِعَوْنِ الْمَلِکِ الْوَھَّابِ اَللّٰھُمَّ ھِدَایَۃَ الْحَقِّ وَالصَّوَابِ
Answer: The transaction of purchasing gold for £200,000 and having it in your possession, selling it to the debtor for £230,000 and having him pay you over a period of time is correct and permissible. This transaction is called murābaha, and it is for one party to sell an item whilst making the profit known. It can also be a loan. However, it is necessary for the gold to be in your possession after purchasing it before you sell it, otherwise the transaction is void.
وَاللہُ اَعْلَمُ عَزَّوَجَلَّ وَ رَسُوْلُہٗ اَعْلَم صلَّی اللہ علیہ واٰلہٖ وسلَّم
Repurchasing a product for a lower price
Question: What do the scholars of Islam say regarding the following: I sold an old phone to my friend for £350. He took possession of the product, and I took possession of the money. However, not long after purchasing the phone, my friend returned and said his family told him to return the phone, as they would buy him a new one after a couple of months. I wish to buy the phone from him for £320, even though I sold it for £350. Is it permissible for me to do so after the completion of the initial transaction?
اَلْجَوَابُ بِعَوْنِ الْمَلِکِ الْوَھَّابِ اَللّٰھُمَّ ھِدَایَۃَ الْحَقِّ وَالصَّوَابِ
Answer: After the first deal was agreed and the exchange was complete, the phone you sold for £350 can be purchased for £320 if both parties agree to it. If the buyer has not paid £350, it is impermissible to buy the phone for £320.
Muftī Amjad ꜤAlī al-AꜤẓamī رَحْمَةُ الـلّٰـهِ عَـلَيْه writes:
It is impermissible to buy an item which has been sold but not paid for completely, even if its price has decreased. If the buyer dies, it is impermissible for his inheritors to buy it too. It is permissible to buy the item for the same price or more or buy it after taking possession of the product.[4]
وَاللہُ اَعْلَمُ عَزَّوَجَلَّ وَ رَسُوْلُہٗ اَعْلَم صلَّی اللہ علیہ واٰلہٖ وسلَّم
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