Leasing land for a fixed amount of money
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Fatwa number ( 19113 )
Q: We are in a rural village, and the main source of income is agriculture. However, often the yield from the agricultural land is not enough to meet the farmers' needs. Therefore, some landowners pledge a piece of this land, and this is done in two forms. The first form: Some landowners take an amount of 10,000 Egyptian pounds, for example, from an individual, and in exchange for that amount, they give him a piece of agricultural land, for example half a feddan, as a pledge, and a contract is drawn up for this. However, one of the conditions of this contract is that the owner of the money (the pledgee) undertakes to cultivate this mentioned piece of land, and he has the right to benefit from what the land produces in crops, and the landowner takes nothing,
and this continues until the amount is repaid. Is this practice permissible or not? The second form: Some landowners give a piece of agricultural land, for example one feddan, to an individual to cultivate it and bear all its costs. At the end of the harvest, the landowner takes an amount of 500 pounds, for example, as rent, and a contract is drawn up for this. However, one of the conditions of this contract is that the landowner takes an amount of 15,000 Egyptian pounds as a guarantee. Is this practice permissible or not?
A: The transaction in both forms is a loan that yields benefit, and it is forbidden. It is obligatory to abandon this practice and turn to the practice that is permissible by the Shari'ah, which is: leasing the land to the one who cultivates it for a fixed amount of money, or for a known portion of what comes out of it. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Q: We are in a rural village, and the main source of income is agriculture. However, often the yield from the agricultural land is not enough to meet the farmers' needs. Therefore, some landowners pledge a piece of this land, and this is done in two forms. The first form: Some landowners take an amount of 10,000 Egyptian pounds, for example, from an individual, and in exchange for that amount, they give him a piece of agricultural land, for example half a feddan, as a pledge, and a contract is drawn up for this. However, one of the conditions of this contract is that the owner of the money (the pledgee) undertakes to cultivate this mentioned piece of land, and he has the right to benefit from what the land produces in crops, and the landowner takes nothing,
and this continues until the amount is repaid. Is this practice permissible or not? The second form: Some landowners give a piece of agricultural land, for example one feddan, to an individual to cultivate it and bear all its costs. At the end of the harvest, the landowner takes an amount of 500 pounds, for example, as rent, and a contract is drawn up for this. However, one of the conditions of this contract is that the landowner takes an amount of 15,000 Egyptian pounds as a guarantee. Is this practice permissible or not?
A: The transaction in both forms is a loan that yields benefit, and it is forbidden. It is obligatory to abandon this practice and turn to the practice that is permissible by the Shari'ah, which is: leasing the land to the one who cultivates it for a fixed amount of money, or for a known portion of what comes out of it. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.