Ruling on a sale with a fixed term and a condition of option
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Question:
What is your opinion, may Allah forgive you, regarding what has become widespread among people, especially in this region, which is a sale with a fixed term?
That is, when a poor person strikes a time limit with a wealthy person, he goes to the wealthy person to seek his help with a loan or the like. The wealthy person refuses unless he sees that this loan brings him a benefit. So he says to the poor person: "Give me some of your agricultural land as a sale with a fixed term." This is nothing but a ruse to exploit the land. The wealthy person takes it without compensation for the landowner, and the lender remains, siphoning off the benefits of the land for many years, which may reach twenty years or less. The poor person finds no means to repay the lender's money, even though the crops that the lender has harvested exceed the amount of the loan.
So give us a ruling, may Allah have mercy on you: Is a sale with a fixed term valid or invalid? And if it is invalid, are the crops deducted from the wealthy person's money, or how is the matter?
May Allah reward you with good.
Answer:
The scholars have differed on the permissibility of a sale with a condition of option for a known term, if the period is more than three days; some permitted it and others prohibited it.
The stronger view is that it is permissible; based on the saying of the Prophet (peace and blessings be upon him):Jami` at-Tirmidhi 1352Sahih (Darussalam) in other evidence.
But a group of scholars who said it is permissible mentioned: that this is restricted to the case where the intention of the sale is the seller's desire to sell and the buyer's desire to buy, but the condition of option was made due to doubt about the item sold, or the price, or for another good purpose.
As for when the intention of the sale contract is for the buyer to benefit from the produce of the item sold, and for the seller to benefit from the price, and they intend to annul the sale when the seller is able to repay the price, then that is not permissible; rather, it is riba; because it is in the meaning of a loan, and every loan that has a condition of benefit is forbidden by consensus.
There is no doubt that the buyer's intention in such a case is to exploit the item sold until the price is returned to him; so that he does not lose the benefit of his money that the seller received. And every ruse by which riba is made lawful is invalid; based on the saying of the Prophet (peace and blessings be upon him):. It was narrated by Abu 'Abdullah Ibn Battah with a good chain, and in its meaning is what is established in the two Sahihs from Jabir that the Prophet (peace and blessings be upon him) said: .
A group of scholars have explicitly stated this issue and explained its prohibition, among them the Shaykh and scholar: 'Abd al-Rahman ibn Abi 'Umar al-Hanbali, the author of (al-Sharh al-Kabir). Here is the text of his statement:
He said in volume four, page (80), section: "If the option is conditioned as a ruse to benefit from the loan; to take the produce of the item sold and its benefit during the period the borrower benefits from the price, and then returns the item sold by the option when the price is returned, then there is no option in it; because it is one of the ruses, and it is not lawful for the one who takes the price to benefit from it during the period of the option, nor to dispose of it.
Al-Athram said: I heard Abu 'Abdullah being asked about a man who buys something from a man and says: "You have the option for so much and so much," like real estate. He said: It is permissible if it is not a ruse; meaning he wants to lend him and take his real estate, exploit it, and give him the option in it; so that he profits from what he lent him by this ruse. If he did not intend this, then there is no harm.
It was said to Abu 'Abdullah: What if he intended to be kind to him; meaning he wants to lend him money he fears will be lost, so he buys something from him and gives him the option; not intending a ruse? Abu 'Abdullah said: This is permissible, except that if he dies, the option is cut off and it is not for his heirs. And Ahmad's statement of permissibility in this issue is understood to apply to an item sold that cannot be benefited from except by consuming it, or that the buyer does not benefit from the item sold during the period of the option; so that it does not lead to the loan bringing a benefit." End of the statement of the author of (al-Sharh al-Kabir).
And from this it is known: that if the sale is free from the intention of a loan, there is no harm in it. And by Abu 'Abdullah, he means Ahmad ibn Hanbal (may Allah have mercy on him).
And among the signs of a ruse: that he sells him real estate or the like for less than its value if the intention were a true sale; like selling what is worth one hundred for fifty; and that is only because he is confident that it is not a sale, but rather a loan in the form of a sale. And Allah knows best.
And may Allah send prayers and peace upon our Prophet Muhammad, his family, and his Companions.
What is your opinion, may Allah forgive you, regarding what has become widespread among people, especially in this region, which is a sale with a fixed term?
That is, when a poor person strikes a time limit with a wealthy person, he goes to the wealthy person to seek his help with a loan or the like. The wealthy person refuses unless he sees that this loan brings him a benefit. So he says to the poor person: "Give me some of your agricultural land as a sale with a fixed term." This is nothing but a ruse to exploit the land. The wealthy person takes it without compensation for the landowner, and the lender remains, siphoning off the benefits of the land for many years, which may reach twenty years or less. The poor person finds no means to repay the lender's money, even though the crops that the lender has harvested exceed the amount of the loan.
So give us a ruling, may Allah have mercy on you: Is a sale with a fixed term valid or invalid? And if it is invalid, are the crops deducted from the wealthy person's money, or how is the matter?
May Allah reward you with good.
Answer:
The scholars have differed on the permissibility of a sale with a condition of option for a known term, if the period is more than three days; some permitted it and others prohibited it.
The stronger view is that it is permissible; based on the saying of the Prophet (peace and blessings be upon him):
And the Muslims will be held to their conditions, except the conditions that make the lawful unlawful, or the unlawful lawful.
المسلمون على شروطهم، إلا شرطًا حرم حلالًا، أو أحل حرامًاBut a group of scholars who said it is permissible mentioned: that this is restricted to the case where the intention of the sale is the seller's desire to sell and the buyer's desire to buy, but the condition of option was made due to doubt about the item sold, or the price, or for another good purpose.
As for when the intention of the sale contract is for the buyer to benefit from the produce of the item sold, and for the seller to benefit from the price, and they intend to annul the sale when the seller is able to repay the price, then that is not permissible; rather, it is riba; because it is in the meaning of a loan, and every loan that has a condition of benefit is forbidden by consensus.
There is no doubt that the buyer's intention in such a case is to exploit the item sold until the price is returned to him; so that he does not lose the benefit of his money that the seller received. And every ruse by which riba is made lawful is invalid; based on the saying of the Prophet (peace and blessings be upon him):
Do not commit what the Jews committed; so that you make lawful the prohibitions of Allah by the slightest of ruses.
لا ترتكبوا ما ارتكبت اليهود؛ فتستحلوا محارم الله بأدنى الحيلMay Allah fight the Jews when Allah forbade them the fats; they rendered them into tallow and then sold them and ate their price.
قاتل الله اليهود لما حرم الله عليهم الشحوم؛ جملوها ثم باعوها فأكلوا ثمنهاA group of scholars have explicitly stated this issue and explained its prohibition, among them the Shaykh and scholar: 'Abd al-Rahman ibn Abi 'Umar al-Hanbali, the author of (al-Sharh al-Kabir). Here is the text of his statement:
He said in volume four, page (80), section: "If the option is conditioned as a ruse to benefit from the loan; to take the produce of the item sold and its benefit during the period the borrower benefits from the price, and then returns the item sold by the option when the price is returned, then there is no option in it; because it is one of the ruses, and it is not lawful for the one who takes the price to benefit from it during the period of the option, nor to dispose of it.
Al-Athram said: I heard Abu 'Abdullah being asked about a man who buys something from a man and says: "You have the option for so much and so much," like real estate. He said: It is permissible if it is not a ruse; meaning he wants to lend him and take his real estate, exploit it, and give him the option in it; so that he profits from what he lent him by this ruse. If he did not intend this, then there is no harm.
It was said to Abu 'Abdullah: What if he intended to be kind to him; meaning he wants to lend him money he fears will be lost, so he buys something from him and gives him the option; not intending a ruse? Abu 'Abdullah said: This is permissible, except that if he dies, the option is cut off and it is not for his heirs. And Ahmad's statement of permissibility in this issue is understood to apply to an item sold that cannot be benefited from except by consuming it, or that the buyer does not benefit from the item sold during the period of the option; so that it does not lead to the loan bringing a benefit." End of the statement of the author of (al-Sharh al-Kabir).
And from this it is known: that if the sale is free from the intention of a loan, there is no harm in it. And by Abu 'Abdullah, he means Ahmad ibn Hanbal (may Allah have mercy on him).
And among the signs of a ruse: that he sells him real estate or the like for less than its value if the intention were a true sale; like selling what is worth one hundred for fifty; and that is only because he is confident that it is not a sale, but rather a loan in the form of a sale. And Allah knows best.
And may Allah send prayers and peace upon our Prophet Muhammad, his family, and his Companions.
Source
binbaz.org.sa
The Arabic text is copied verbatim from the original source, without any edits.