The cooperative society’s condition on the tenant of 10% for delaying the rent
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Fatwa number ( 18761 )
Q: The cooperative society owns some real estate and rents it to others, but some customers delay paying the rent, and some of them procrastinate and waste the society’s money, which is owned by many people, including those who are well-off, those who are in need, and the minors and widows among the heirs. It is our duty to protect their rights. From this perspective, we added a clause to the lease contracts stating the society’s right to terminate the contract and demand the vacating of the premises if the tenant does not commit to paying the rent on the date specified in the contract, unless the tenant agrees to increase the rent for the remaining period of the contract by 10%. He is also granted a 10% discount on the rent specified in the contract if he commits to paying the rent in advance for the entire year; this is to encourage them to pay. We ask your Eminence to kindly inform us whether this clause in the contract, if agreed upon by both parties, conflicts with the Shari'ah texts or not?
A: The condition imposed by the aforementioned cooperative society on the tenant of 10% for delaying the rent beyond its specified due date is not permissible; because it resembles the riba of the pre-Islamic age of ignorance, in the statement of the creditor: “Either you pay or you increase,” meaning: you add to it.
Q: The cooperative society owns some real estate and rents it to others, but some customers delay paying the rent, and some of them procrastinate and waste the society’s money, which is owned by many people, including those who are well-off, those who are in need, and the minors and widows among the heirs. It is our duty to protect their rights. From this perspective, we added a clause to the lease contracts stating the society’s right to terminate the contract and demand the vacating of the premises if the tenant does not commit to paying the rent on the date specified in the contract, unless the tenant agrees to increase the rent for the remaining period of the contract by 10%. He is also granted a 10% discount on the rent specified in the contract if he commits to paying the rent in advance for the entire year; this is to encourage them to pay. We ask your Eminence to kindly inform us whether this clause in the contract, if agreed upon by both parties, conflicts with the Shari'ah texts or not?
A: The condition imposed by the aforementioned cooperative society on the tenant of 10% for delaying the rent beyond its specified due date is not permissible; because it resembles the riba of the pre-Islamic age of ignorance, in the statement of the creditor: “Either you pay or you increase,” meaning: you add to it.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.