النص المفهرس

Hadrat Muftī Muhammad Taqī 'Uthmanī Sahib has discussed this issue
in detail. He also provided answers to the objections which are made
against it. For details, refer to: Ghayr Sūdī Bank-kārī, Islam Aur Jadīd
Ma'īshat Wa Tijarat and Islam Aur Jadīd Ma'ashī Masā'il.
Objection and a reply to it
One objection remains. If the company goes bankrupt, then according
to the rules of mudarabah, all profits which were made from the
beginning of the agreement by the owner and the mudarab will have
to be returned.
إن قسم الربح وبقيت المضاربة ثم بلك المال أو بعضه ترادا الربح ليأخذ
المالك رأس المال وما فضل بينهما وإن نقص لم يضمن. (الدر المختار: ٥/٦٥٦،
سعيد)
An answer to this is that a limited company must make a new
agreement with its shareholders annually. If the company goes
bankrupt, only the profits which were made after the new agreement
will be attached.
وإن قسم الربح وفسخت المضاربة والمال في يد المضارب ثم عقدابا فهلک
المال لم يترادا وبقيت المضاربة لأنه عقد جديد وبي الحيلة النافعة للمضارب.
وفي رد المحتار: قوله النافعة للمضارب أى لو خاف أن يسترد من رب المال
الربح بعد القسمة بسبب بلاك ما بقي من رأس المال وعلم مما مرآنفاً أنه لا
يتوقف صحة الحيلة على أن يسلم المضارب رأس المال إلى رب المال وتقييد
الزيلعي به اتفاقي كما نبه عليه أبو السعود. (الدر المختار مع رد المحتار: ٥/٦٥٦،
سعید)
To sum up, it is permissible to register a limited liability and to buy its
shares while observing the previously mentioned conditions.
Allāh ta'ālā knows best.
Specifying an additional amount for the working partner
Question
There are two partners in a business. That is, the capital of both is
combined. One of them does the work while the other does not. A
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larger share is specified for the one who does the work. Is this
permissible? Is this a partnership or mudārabah?
Answer
This is essentially a mudarabah agreement in which the worker
receives an additional percentage, e.g. 80%. For example, Zayd puts in
R100 000.00 and 'Umar puts in R100 000.00. Since 'Umar does the work,
80% is specified for him and 20% for 'Umar. This means that 50% of the
profits are for 'Umar from his goods. From the remaining 50%, 30% is
for 'Umar for his work, and 20% for Zayd because of his goods. The
partnership will be partnership in profits, which is actually
mudārabah.
قال ابن عابدين رحمه الله تعالى فى الشركة: وفى النهر اعلم أنهما إذا شرطا
العمل عليهما أن تساويا مالاً وتفاوتا ربحاً جاز عند علمائنا الثلاثة رحمهم
الله تعالى خلافاً لزفر رحم الله تعالى، والربح بينهما على ما شرطا وإن عمل
أحدبما فقط، وإن شرطاه على أحدبما، فإن شرطا الربح بينهما بقدر رأس
مالهما جاز، ويكون مال الذي لا عمل له بضاعة عند العامل له ربح وعليه
وضيعته وإن شرطا الربح للعامل أكثر من رأس ماله جاز أيضاً على الشرط
ويكون مال الدافع عند العامل مضاربة، ولو شرطا الربح للدافع أكثر من
رأس ماله لا يصح الشرط ويكون مال الدافع عند العامل بضاعة لكل واحد
منهما ربح ماله والوضيعة بينهما على قدر رأس مالهما أبداً بذا حاصل ما فى
العناية. ما فى النهر، قلت: وحاصل ذلك كله أن إذا تفاضلا فى الربح فإن
شرطا العمل عليهما سوية جاز ولو تبرع أحديما بالعمل وكذا لو شرطا العمل
على أحدبما وكان الربح للعامل بقدر رأس ماله أو أكثر ولو كان الأكثر لغير
العامل أو لأقلهما عملاً لا يصح وله ربح ماله فقط، وبذا إذا كان العمل
مشروطاً. الخ. (رد المحتار: ٤/٣١٢، كتاب الشركة، سعيد)
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تقريرات الرافعى:
(قوله وإن شرطاه على أحديما فإن شرطا الربح بينهما بقدر الخ) فى الدرر من
كتاب المضاربة ما نصه: والثالث أى من شروط المضاربة تسليمه إلى المضارب
حتى لا يبقى لرب المال فيه يد لأن المال يكون أمانة عنده فلا يتم إلا
بالتسليم كالوديعة بخلاف الشركة لأن المال فى المضاربة من أحد الجانبين
والعمل من الجانب الآخر فلا بد أن يخلص المال للعامل ليتمكن من
التصرف فيه، وأما العمل فى الشركة فمن الجانبين فلو شرط خلوص اليد
لأحدبما لم تنعقد الشركة لانتفاء شرطها وبو العمل منهما، فظابر ما فيها
ينافى ما نقله المحشي ويقال في دفع المنافاة إن شرط العمل منهما شرط
لتحقيق الشركة وإذا شرط على أحدبما تكون مضاربة أو بضاعة على ما ذكره
المحشي تأمل، ثم أنه لا حاجة .. إلى قوله وتخصيص العمل بأحديما يخرج
المسألة عن أن تكون من مفردات مسائل الشركة بل بي حينئذٍ بضاعة إن
شرط العمل على أحدبما مع التساوي فى الربح ومضاربة إن شرط الفضل
للعامل. (التحرير المختار على بامش رد المحتار: ٤/٧٠، سعيد)
Jadīd Mu'āmalāt Ke Shar'ī Ahkām:
In a partnership, there has to be work from both partners. This is a
precondition and it is not found here. This is why it is not a
partnership but a mudarabah. If no condition is laid down for the
owner of the goods to put down goods, there is no objection to it. If it
is preconditioned, it will still be permissible because of the affinity
between a partnership (shirkah) and mudarabah. In such a case,
mudarabah is the basis and shirkah is subordinate. This is why the
condition of work from both parties has been removed. In the same
way, together with the condition of work from both partners, it is also
permissible to have differences in the share of profits because this is
preferred over the case where shirkah is the basis and mudarabah is
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the subordinate. This is why laying down the condition of work from
both partners is not harmful.1
Further reading: Islam Aur Jadīd Ma'āshī Masā'il, vol. 5, p. 47.
Allāh ta'ālā knows best.
Giving money to a company on the basis of mudarabah
Question
A person gave a certain amount of money to a company for the
purchase of a tank. The company buys the tank and gives it over to its
manager who then hires out this tank together with other tanks. The
acquired profits are then distributed among themselves as follows:
15% for the manager, 5% for the company, and the remaining profits
are distributed among the tank-owners. Does the Shari'ah permit an
agreement of this nature?
Answer
This is a mudarabah agreement. The owners of the tanks are classified
as rabb al-mal (owners of the wealth). The company, its manager, etc.
are classified as mudarab. The mudarabah goods are mixed with goods
belonging to others and business is done with them through the
explicit permission of the rabb al-mal or by saying: "Do as per your
opinion." This is permissible. The profits are specified on a percentage
basis. This mudarabah agreement is correct and permissible.
الفتاوى الهندية:
الأصل أن ما يفعله المضارب ثلاثة أنواع نوع يملكه بمطلق المضاربة وہو ما
يكون من باب المضاربة وتوابعها ومن جملته التوكيل بالبيع والشراء
للحاجة ... ونوع لا يملك بمطلق العقد ویملکه إذا قيل له اعمل برایک وہو
ما يحتمل أن يلحق به فيلحق به عند وجود الدلالة وذلك مثل دفع المال
مضاربة أو شركة إلى غيره وخلط مال المضاربة بماله أو بمال غيره. (الفتاوى
الهندية: ٤/٢٩١، باب فى ما يملك المضار بمن التصرفات)
1 Jadīd Mu'āmalāt Ke Shar'ī Ahkām, vol. 2, p. 31.
842

الدر المختار:
ولا يملك المضاربة والشركة والخلط بمال نفسه إلا بإذن. وفي رد المحتار:
قوله والخلط بمال نفس أى أو غيره كما فى البحر إلا أن تكون معاملة
التجار في تلك البلاد أن المضاربين يخلطون، ولا ينهونهم فإن غلب التعارف
بينهم في مثل وجب أن لا يضمن كما فى التاتارخانية. (الدر المختار مع رد
المحتار: ٥/٦٤٩، كتاب المضاربة، سعيد)
فتاوی قاضیخان:
وللمضارب أن يعمل ما بو من عادات التجار وبو ... واستئجار الأجراء لحفظ
المال واستئجار الدواب للحمل واستئجار المكان والسفر. (فتاوى قاضيخان
بهامش الفتاوى الهندية: ٣/١٦٦، فصل فى ما يجوز للمضارب على المضاربة).
(وكذا فى البحر الرائق: ٧/٢٦٤، كوئته)
شرح المجلة:
الثاني أن يكون جزءاً شايعاً قل أو كثر كالنصف أو الثلث لأن الشركة فى
الربح إنما تتحقق به حتى لو شرطا لأحدبما مائة من الربح مثلاً أو مائة مع
الثلث أو الثلث إلا مائة والباقي للآخر لم تجز المضاربة لأنه يؤدي إلى قطع
الشركة فى الربح لجواز أن لا يربح إلا ذلك القدر. زيلعى، وحاشية للشلبي.
(شرح المجلة لمحمد خالد الاتاسى: ٤/٣٣٣، تحت المادة: ١٤١١)
Further reading: Jadīd Mu'āmalāt Ke Shar'ī Ahkām, vol. 2, p. 23.
Nowadays, it is common and well-known that other goods are mixed
with mudarabah goods. There is no need to obtain permission to do
this. This is clear from the text of Shamī rahimahullah.
Allāh ta'ālā knows best.
843

Terminating a mudarabah
Question
Zayd and 'Umar started a mudarabah in 2002. Zayd's share (as the
owner of the goods) was specified as 25% and 'Amr's share (as the
mudarab) was specified as 75%. In 2007, the mudarab gave only three
thousand as profit to the owner, and asked him to take back his
capital. When he was asked for the remaining profits, the mudarab
said that he will pay them in instalments over a period of time. My
question is: Has the mudarabah terminated? Is it correct to collect the
remaining profits later on?
Answer
A mudarabah agreement can be terminated after informing the owner.
If the mudarab does not have the money at present, it is permissible to
collect the remaining profits later on. However, if the mudarab has the
money, it is not permissible for him to delay in paying it.
بدائع الصنائع :
وأما صفة بذا العقد فهو أن عقد غير لازم ولكل واحد منهما أعني رب المال
والمضارب الفسخ لكن عند وجود شرطه وبو علم صاحبه لما ذكرنا في كتاب
الشركة ويشترط أيضاً أن يكون رأس المال عيناً وقت الفسخ درابم أو دنانير
حتى لو نهى رب المال المضارب عن التصرف ورأس المال عروض وقت النهى
لم يصح نهيه. (بدائع الصنائع: ٦/١٠٩، سعيد)
بداية المجتهد:
أجمع العلماء على أن اللزوم ليس من موجبات عقد القراض، وان لكل واحد
منهما فسخر ما لم يشرع العامل فى القراض، واختلفوا إذا شرع العامل، فقال
مالك: بو لازم ... وقال الشافعى وأبو حنيفة: لكل واحد منهم الفسخ إذا شاء.
(بداية المجتهد: ٢/١٨١، القول فى احكام القراض، دار نشر الكتب)
Fatāwā Haqqānīyyah:
Either of the two parties in a mudarabah agreement can terminate the
agreement as and when he wants. However, it is necessary for one to
844

inform the other. The termination will be correct only when the
wealth is available in the form of cash. If the wealth is in the form of
goods, the mudarab will be given the opportunity to sell them so that
the original profit can be ascertained - the reason for which the
agreement was made.1
Further reading: Islāmī Fiqh, vol. 2, p. 397.
Allāh ta'ālā knows best.
Specifying a wage for the mudarab
Question
A person works in a shop on the basis of mudarabah. He receives 25%
of the profits while the owner takes 75%. Alternatively, he is a partner
with someone. Can the partner or the mudarab receive a wage in
addition to his share? Giving a wage is quite common in our area.
Answer
The mudarab will receive a percentage of the profits in return for his
work. He cannot take a monthly specified salary. Yes, if the mudarab
works as a paid employee, he may take a wage. If, together with the
salary, an amount is reduced from the profits and given to him; then
this is also permissible. Whether a partner can become a hireling or
not is a contentious issue among the 'ulama'. Most jurists say that it is
not permissible. However, Hadrat Muftī Rashīd Ahmad Ludhyanwī
Sāhib rahimahullāh has permitted it.
رد المحتار:
لا أجر للشريك فى العمل بالمشترك. (رد المحتار: ٤/٣٢٦، سعيد)
النتف فى الفتاوى:
لو كان طعام بين رجلين فقال أحد بما لصاحبه: احمل إلى الموضع كذا، ولک
في نصيبي من الأجر كذا، أو قال: اطحنه ولک في نصيبي كذا من الأجر، جاز
ذلك في قول زفر ومحمد بن صاحب، ولا يجوز في قول أبي حنيفة وأبي يوسف
1 Fatāwā Haqqānīyyah, vol. 6, p. 354.
845

ومحمد. (النتف فى الفتاوى: ص ٣٤٩، كتاب الاجارة، اجارة الشريك
شريك، سعيد)
After quoting the texts of the jurists, Muftī Rashid Sahib writes:
The following points are established from the previously-quoted texts:
1. The impermissibility of keeping a partner as an employee is
not proven from any text of the Shari'ah.
2.
There is no narration in this regard from Hadrat Imam [Abū
Hanīfah] Sāhib rahimahullāh.
3. It is a view of Imam Muhammad rahimahullah but no reason is
reported in this regard.
4. The reasons provided by some scholars are questionable by
other scholars.
5. 'Allāmah Sa'dī rahimahullah has classified it as ijārah al-
mushā‘.
6. Ijārah al-mushā' is unanimously permissible by the four
Imāms, but Imām Abū Hanīfah rahimahullah says that it is
impermissible for a non-partner.
7. Like ijarah al-musha', the three Imams concur on the
permissibility of employing a partner.
8. Despite the prohibition of qafiz at-tahhan being established by
a Shari' ah text, some jurists permit it on the basis of common
practice. However, other jurists did not permit it because the
common practice is specific to those countries; and it is
impermissible to cast aside a Shari'ah text for a specific
common practice.
9. General common practice is a pre-requisite for leaving aside a
text of the Shari'ah. However, even a specific practice will be
sufficient reason to leave aside a text of the madh-hab.
10. As regards the Hanafi madh-hab, preference is given to the
statements of Imam Abu Yusuf and Imam Muhammad
rahimahumallah as regards injunctions based on common
practice.
11. A text of the madh-hab can be left aside for the sake of a
specific common practice. As for keeping partners of a
company as employees, this is a general common practice.
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Therefore, there is more reason to leave aside the text of the
madh-hab. This is especially so when this text is not of Imam
Sāhib's but a view of Imam Muhammad rahimahullāh, due to
which common practice is given preference.1
رسائل ابن عابدين:
قال ابن عابدين: فهذه النقول ونحوبا دالة على اعتبار العرف الخاص وإن
خالف المنصوص عليه في كتب المذبب ما لم يخالف النص الشرعي ... أقول:
وبما قررناه تبين لك أن ما تقدم عن الأشباه من المذيب عدم اعتبار العرف
الخاص إنما بو فيما إذا عارض النص الشرعي وأما العرف الخاص إذا عارض
النص المذيبى المنقول عن صاحب المذب فهو معتبر كما مشى عليه
أصحاب المتون والشروح والفتاوى ... ليس للمفتي ولا القاضي أن يحكما
بظابر الرواية ويتركا العرف. (رسائل ابن عابدين: ٢/١٣٣)
وفيه أيضاً: فهذا كله وأمثاله دلائل واضحة على أن المفتي ليس له الجمود على
المنقول في كتب ظابر الرواية من غير مراعاة الزمان وأبله وإلا يضيع حقوقاً
كثيرة ويكون ضرره أعظم من نفعه. (رسائل ابن عابدين: ٢/١٣١)
وفيه أيضاً: ولهذا ترى مشايخ المذبب خالفوا ما نص عليه المجتهد في
مواضع كثيرة بنابا على ما كان في زمنه لعلمهم بأنه لو كان في زمنهم لقال بما
قالوا به أخذاً من قواعد مذیپه. (رسائل ابن عابدين: ٢/١٢٥، مکتب محمدویم،
کوئته)
العرف والعادة:
بيع الثمار على الأشجار ... وظابر مذيب الحنفية بطلانه، وبه قال شمس الأئمة
السرخسي، وأفتى الحلواني وأبو بكر بن الفضل من مشايخ المذبب بالجواز ...
1 Ahsan al-Fatāwā, vol. 7, p. 328.
847

والحلواني وابن الفضل عدلا عن ظابر المذبب للعرف، قال ابن الفضل:
استحسن فيه لتعامل الناس، فإنهم تعاملوا ببيع ثمار الكرم بهذه الصفة، ولهم
في ذلك عادة ظابرة، وفي نزع الناس عن عاداتهم حرج، وكون بذا من بيع
المعدوم المنهى عنه وتصريح ظابر المذبب ببطلانه، لا يمنع من صحة ما أفتوا
به، لأن العرف كما علمنا يخصص الأدلة ويعدل به عن ظابر المذيب.
(العرف والعادة، ص ١٧٢، ١٧٣)
To sum up, the easiest option should be chosen to provide ease to
people in these transactions. This is on the condition that the limits of
the Shari'ah are not transgressed. Since it is common practice to pay a
salary to an employed partner, there is room for its permissibility as
per the statement of Hadrat Muftī Rashīd Sahib rahimahullāh.
Allāh ta'ālā knows best.
Terminating a mudarabah when there are no profits
Question
Two persons entered into a mudarabah agreement. One will provide
the goods while the other will do the work. A plot of land was
purchased for R100 000.00 with a view to constructing some shops on
it. The profits derived from them will be divided equally between the
two. The construction work will continue for about a year. Five
months after the agreement, the owner of the goods wants to
terminate it. During this period, about R30 000.00 were spent on the
construction from the capital wealth. My question is, if the mudarab
keeps the land for himself, how much money will he return to the
owner? Secondly, no profit was made thus far, so what will the
mudārab receive?
Answer
Each person has the right to terminate the mudarabah agreement by
informing the other. Once a decision is taken to terminate it, it is
necessary for the mudarab to return the capital amount to the owner.
In this case, the mudarab must either sell the land to someone else or
buy it himself, and return the capital amount. Since no profits were
made thus far, the mudarab will not receive anything.
848

وأما صفة بذا العقد فهو أنه عقد غير لازم ولكل واحد منهما أعني رب المال
والمضارب الفسخ لكن عند وجود شرطه وہو علم صاحبه لما ذكرنا في کتاب
الشركة ويشترط أيضاً أن يكون رأس المال عيناً وقت الفسخ درابم أو دنانير
حتى لو نهى رب المال المضارب عن التصرف ورأس المال عروض وقت النهى
لم يصح نهيم، وله أن يبيعها لأنه يحتاج إلى بيعها بالدرابم والدنانير ليظهر
الربح فكان النهى والفسخ إبطالاً لحق فى التصرف فلا يملک ذلک. (بدائع
الصنائع: ٦/١٠٩، سعيد)
وفيه أيضاً: والثاني ما يستحق المضارب بعمله فى المضاربة الصحيحة بو
الربح المسمى إن كان فى المضاربة ربح ... فإن لم يكن فيها ربح فلا شيء
للمضارب لأن الشرط قد صح فلا يستحق إلا ما شرط وہو الربح ولم يوجد.
(بدائع الصنائع: ٦/١٠٧، سعيد)
وفيه أيضاً: ويجوز شراء رب المال من المضارب وشراء المضارب من رب المال،
وإن لم يكن فى المضاربة ربح في قول أصحابنا الثلاثة. (بدائع الصنائع: ٦/١٠١،
سعيد)
If the mudarabah agreement has been concluded and the mudarab did
not start his work as yet, then all the Imams concur and say that each
of the two parties has the right to terminate the agreement. But if the
mudarab has started the work, there is difference of opinion as to
whether they have the right to terminate the agreement or not. Imam
Mālik rahimahullah says that neither of the two has the right to
terminate it. Imam Abū Hanīfah and Imām Shafi'ī rahimahumallāh say
that each of the two always has the right to terminate it whenever he
wants. However, it is necessary for one to inform the other of the
termination.
If the value of the land which was bought with the capital amount has
increased, the profit in favour of the mudarab will be established. Now
the capital amount will be separated from the amount they receive
after selling it, and the profit will be divided between the two.
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(ولا يعتق عليه) أى المضارب (إن كان فى المال ربح) ... (فإن فعل ... وقع
الشراء لنفسه) وإن لم يكن ربح كما ذكرنا (صح) [أى الشرئ] للمضاربة،
فإن ظهر الربح بزيادة قيمته [أى العبد] بعد الشراء عتق عليه حظر، ولم
يضمن نصيب المالك لعتقم لا بصنعه. (الدر المختار: ٥/٦٥١، سعيد)
Allāh ta'ālā knows best.
A mudarab having to pay for losses
Question
Hamid and Mahmud started a business. The agreement stated that
Mahmud will give R500 000.00 as the capital while Hamid will conduct
the business. From the profits, Mahmud will take 75% and Hamid will
receive 25%. If any loss is suffered, it will be borne by Mahmud. They
ran the business according to the agreement for two years. Some time
ago, few people bought goods from Hamid and disappeared without
paying for the goods. Mahmud is now asking Hamid to pay for the loss
whereas this is different to what the agreement states. Hamid had
been conducting the business correctly as much as he could. He did
not fall short in any way. What is the ruling of the Shari'ah?
Answer
In a mudarabah agreement, the goods which the mudarab receives are
classified as an amanah (trust). He is also a wakīl (representative) as
regards the will which he exercises over the goods. In other words, he
is a representative on behalf of the one who provided the goods.
Bearing in mind that he is an entrusted person, it is essential for him
to protect the goods. If an incidental loss occurs in the capital or gets
destroyed, the mudarab is not responsible for it. However, if there is
proof that he wittingly destroyed the goods, he will be liable.
Furthermore, he will also be liable if he acts against the conditions laid
down by the owner.
Bearing in mind the above ruling of the Shari'ah, the ruling with
regard to the present situation is that the loss will be first recovered
from the profits. If no profit was made or the loss is more than the
profit, and Hamid displayed no shortcoming in the business, then
Hamid will not be responsible for the loss. Instead, Mahmud will bear
the loss.
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If the precondition of loss in the agreement was applied to the
mudarab, he will still not be liable for it. Also, the mudarabah will not
be invalidated. Rather, the condition will be invalidated.
(ويملك المضارب فى المطلقة) التي لم تقيد بمكان أو زمان أو نوع (البيع) ...
(بنقد ونسيئة متعارفة). وفي رد المحتار: قوله بنقد ونسيئة ولو اختلفا فيهما
فالقول للمضارب فى المضاربة. (الدر المختار مع رد المحتار: ٥/٦٤٨، كتاب
المضاربة، سعيد)
الهداية:
وما پلک من مال المضاربة فهو من الربح، دون راس المال، فإذا زاد الهالک
على الربح فلا ضمان على المضارب لأنه أمين. (الهداية: ٣/٢٦٦)
(وكذا فى الدر المختار مع رد المحتار: ٥/٦٥٦، سعيد)
الهداية:
وغير ذلك من الشروط الفاسدة لا يفسدبا ويبطل الشرط كشرط الوضيعة
على المضارب. (الهداية: ٣/٢٥٨. وكذا فى الدر المختار: ٥/٦٤٨)
Jadīd Mu'āmalāt Ke Shar'ī Ahkām:
The mudarabah agreement in the present case is correct, but the full
loss will be borne solely by the one who provided the capital. The
mudarab will not be liable for anything in this regard.
وفي رد المحتار: قوله بطل الشرط كشرط الخسران على المضارب .!
Allāh ta'ālā knows best.
The method of acquiring profits according to Islamic principles
Question
A bank or company accepts money according to Islamic principles
from people, acquires profits from their money, and then distributes
1 Jadīd Mu āmalāt Ke Sharī Ahkām, vol. 2, p. 33.
851

the profits among them. What is the correct procedure for doing all
this?
Answer
The bank or company must accept the money from people on the basis
of mudarabah. Those who give their money will be like the owner of
the wealth, while the bank or company will be like a mudarab
provided it engages in business. And the profits will be distributed
among them according to a pre-agreed percentage. For example, the
owner shall receive 40% while the mudarab (bank or company) will
receive 60%. Obviously, the date of the deposit and withdrawal of
monies is not the same. The calculation will therefore be done daily,
and the profit will be distributed on a daily product basis. Whatever
number of days a person deposits his money in the bank, he will
receive the average amount of profits for those days.
المضاربة عقد يقع على الشركة بمال من أحد الجانبين ومراده الشركة فى الربح
وبو يستحق بالمال من أحد الجانبين والعمل من الجانب الآخر ولا مضاربة
بدونها. (الهداية: ٣/٢٥٧، كتاب المضاربة)
It is essential to observe the following fundamental principles of
partnership and mudarabah for the sake of acquiring profits:
1. It is not permissible to specify the profits [return of investment] in
proportion to the capital. The correct Shari'ah procedure for
specifying the profit is to specify the percentage which a person will
receive from the real profit which is made.
2. The proportion of profit can be anything provided it is agreed upon
through mutual acceptance. It is not necessary to distribute the profit
according to the capital. However, the profit of the partner who lays
down the condition that he will not do the work cannot be more in
proportion to his capital.
3. Different conditions can be applied to the different partners as
regards the profit, but it is not permissible to do this when a loss is
suffered. The loss will always be in proportion to the capital. The
jurists express this principle as follows:
الربح على ما اصطلحوا عليه، والوضيعة بقدر رأس المال.
Further reading: Islām Aur Jadīd Ma'īshat Wa Tijārat; Islāmī Fiqh (vol. 2);
Islām Aur Jadīd Ma'āshī Masā'il (vol. 5)
852

Objection and answer
One objection to the "daily calculation" is that distribution of profits
in this way is an immediate distribution and not a genuine distribution
of profits. There is the possibility of a portion of Zayd's real profit
going to 'Umar.
An answer to this is that the monies of the partners get mixed up.
Therefore, when distributing the profit, the real profit is not
considered. Rather, the accumulated profit from the accumulated
capital is distributed. If not, it is also possible that no profit at all was
made from Zayd's capital while it was made solely from 'Umar's.
Therefore, the Shari'ah does not require a real profit; a close profit is
sufficient.
Further reading: Islam Aur Jadīd Ma'īshat Wa Tijārat by Hadrat Muftī
Taqī 'Uthmānī Sāhib.
Allāh ta'ālā knows best.
When a mudarabah is restricted to a time
Question
In a mudarabah agreement, a person said: "You may invest your
money for as long as you want, but the minimum has to be five years
and the maximum will be fifteen years." Is it permissible to lay down
such a condition?
Answer
It is permissible to restrict a mudarabah agreement to a time period
and to lay down a condition of this nature. However, we learn from the
statements of the jurists that it is incorrect to lay down a minimum
period. A person has to have the choice of terminating the agreement
before that time.
وإن وقت للمضاربة وقتاً بعين يتقيد به حتى يبطل العقد بمضيه. (الفتاوى
الهندية: ٤/٢٩٨)
(وكذا فى شرح المجلة: ٤/٣٥٥، المادة : ١٤٢٠)
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Islāmī Figh:
In the case where a time is specified, each party has the right to
terminate the agreement the moment the time expires.1
Islām Aur Jadīd Ma āshī Masā'il:
According to Hanafi and Hambalī jurisprudence, a mudarabah
agreement can be confined to a specified time, e.g. one year, six
months, etc. after which, the mudarabah will terminate without any
notice ... Can the two parties specify a minimum period before which
the mudarabah cannot be terminated? One principle is generally
mentioned. From it we learn that a time period of this nature cannot
be specified, and that each party has the right to terminate the
agreement whenever it wants.
This unrestricted right of terminating the mudarabah agreement by
either party could create some challenges in the present conditions.
Most businesses require some time to demonstrate their successes.
They require complex and focussed mental efforts. If the owner of the
wealth were to terminate the mudarabah right at the beginning, it
would cause a major difficulty for this objective. The mudarab will be
especially distressed because he could not earn anything despite all his
efforts. Therefore, if at the time of entering the mudarabah
agreement, both parties agree not to terminate the agreement before a
specified time - except for certain special situations - then this does
not appear to be in conflict with any principle of the Shari'ah. This is
especially so in the light of the following Hadith:
المسلمون على شروطهم إلا شرطاً أحل حراماً أو حرم
حلالاً. (رواه الترمذى وصححه، برقم: ١٣٥٢، فى باب ما
يذكر عن رسول الله صلى الله عليه وسلم فى الصلح بين
الناس)
The mutual preconditions of Muslims will be
maintained except for a condition which legalizes
the unlawful and prohibits the lawful.2
Allāh ta'ālā knows best.
1 Islāmī Fiqh, vol. 2, p. 397.
2 Islām Aur Jadīd Ma āshī Masā'il, vol. 5, pp. 46-47.
854

Few issues related to mudarabah
I am taking the courage to ask a few questions related to mudarabah.
Kindly bless me with answers.
Question one:
If the owner lays down the condition on the mudarab that he must
only engage in cash transactions, can he do business on credit?
Answer:
He cannot.
ولو دفعه إليه مضاربة على أن يشتري بالنقد ويبيع فليس له أن يشتري إلا
بالنقد لأن بذا تقييد مفيد في حق رب المال. (المبسوط للامام السرخسى:
٢٢/٤٤، باب ما يجوز للمضارب وما لا يجوز)
Allāh ta'ālā knows best.
Question two:
Is it permissible to enter into a mudarabah agreement with a non-
Muslim?
Answer:
This is a transaction and sameness in religion is not necessary when
engaging in transactions. Rasūlullah sallallahu 'alayhi wa sallam had
business dealings with non-Muslims.
وإسلامه ليس بشرط أصلاً فتجوز الإجارة والاستئجار من المسلم والذي
والحربي المستامن لأن بذا من عقود المعاوضات فيملكه المسلم والكافرجميعاً
كالبياعات ... الخ. (بدائع الصنائع: ٤/١٧٦، كتاب الاجارة، سعيد)
Allāh ta'ālā knows best.
Question three:
I gave R100 000.00 to a mudarab to conduct a business. He himself is a
businessman and takes goods/capital from other people as
mudarabah. Is this correct? What I mean is that is it correct for him to
mix the goods/capital of different people?
Answer:
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He can do this if he obtains the permission of the owner of the goods.
If he does not permit him explicitly, a permission on the basis of
common practice will suffice because societal norms and common
practices apply in this case.
ولا يملك المضاربة والشركة والخلط بمال نفسه إلا بإذن. وفي رد المحتار:
قوله والخلط بمال نفس أى أو غيره كما فى البحر إلا أن تكون معاملة
التجار في تلك البلاد أن المضاربين يخلطون، ولا ينهونهم فإن غلب التعارف
بينهم في مثله وجب أن لا يضمن كما فى التاتارخانية. (الدر المختار مع رد
المحتار: ٥/٦٤٩، كتاب المضاربة، سعيد)
Question four:
I live in Lenasia and my business is in Johannesburg. I am a mudarab
on behalf of Zayd. I have to travel daily to Johannesburg which is
about 25kms away. Can I collect an amount of money for the vehicle
expenses?
Answer:
When a mudarab leaves the city in which he resides for the sake of
doing the work of mudarabah, he can collect for boarding and lodging
as per societal norms and practices.
We learn from the statements of the jurists that if the person can
return to his house by nightfall, it will not be necessary to pay his
expenses from the mudarabah wealth. If his journey is such that it is
difficult for him to return home by nightfall, he can pay for his
expenses from the mudarabah wealth.
Refer to: Badā'i' as-Sanā'i', vol. 6, pp. 105-106; al-Fatāwā al-Hindīyyah, vol.
4, p. 312; Fatāwā ash-Shāmī, vol. 5, p. 657.
This is based on societal norms. In our society, the afternoon meal is
normally provided by the owner when a person goes out of the city to
work, even if he returns home by the evening. Furthermore, when the
employee uses his own car, the fuel is paid for from the business. In
fact, in many places the owner provides a company vehicle. This is
why we say that these issues revolve around societal norms and
practices.
Allāh ta'ālā knows best.
856

Mudarabah with a telephone company
Question
A person received a license from the government to run a telephone
company. He paid about $20 000.00 as fees. The man spent a lot of
money and energy in obtaining this license. He started a company to
run the business. He requires more money to purchase machines. He
asks ten persons to give him $15 000.00 on the condition that whatever
profit the business makes, he will give them a specified percentage.
After one year, the capital with the profit will be paid to them. He also
laid down the condition that none of the ten will interfere in the
business in any way. The man will run the business as he wants.
a) Is it permissible to invest one's money for one year in a company,
and to take back the capital investment with the profit after one year?
b) Will the capital investment be guaranteed?
c) Is an agreement of this nature permissible?
Answer
a) The above scenario is one of mudarabah and it is permissible.
Mudarabah refers to one person providing the capital while the other
doing the work. The profit will be divided on a percentage basis as per
the conditions laid down. It is not permissible for either of the party to
specify an amount. Similarly, it is not permissible to take a percentage
of the capital because this falls under usury.
المضاربة ... شرعاً عقد شركة فى الربح بمال من جانب رب المال وعمل من
جانب المضارب. وفي رد المحتار: قوله من جانب المضارب قيد به لأنه لو
اشترط رب المال أن يعمل مع المضارب فسدت. (الدر المختار مع رد المحتار:
٥/٦٤٥، كتاب المضاربة، سعيد)
وفيه أيضاً: ومن شروطها: كون نصيب المضارب من الربح حتى لو شرط له من
رأس المال أو منه ومن الربح فسدت، وفى الجلالية: كل شرط يوجب جهالة فى
الربح أو يقطع الشركة فيه يفسدبا وإلا بطل الشرط وصح العقد اعتباراً
بالوكالة ... (ويملك المضارب فى المطلقة) التي لم تقيد بمكان أو زمان أو نوع
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(البيع) ... (بنقد ونسيئة متعارفة والشراء والتوكيل بهما والسفر براً وبحراً).
(الدر المختار: ٥/٦٤٨، سعيد)
b) A mudarabah for one year is permissible. It is referred to as
mudarabah muwaqqatah. Details in this regard were given previously.
c) The capital will not be guaranteed. Rather, the mudarab will work
with it as an amin (entrusted person) provided no transgression is
committed. If a loss is suffered without any transgression on the part
of the mudarab, the loss will first be recovered from the profit. If the
profit is insufficient, it will be recovered from the capital.
قوله بطل الشرط كشرط الخسران على المضارب. (فتاوى الشامى: ٥/٦٤٨،
سعيد)
وفى الدر المختار: وما بلك من مال المضاربة يصرف إلى الربح لأنه تبع فإن زاد
الهالك على الربح لم يضمن ولو فاسدة من عمله لأنه أمين، وفي رد المحتار:
قوله ولو فاسدة أى سواء كانت المضاربة صحيحة أو فاسدة، وسواء كان
الهلاك من عمله أو لا، ح (قوله من عمله) يعنى المسلط عليه عند التجار،
وأما التعدي فيظهر أنه يضمن سائحاني. (الدر المختار مع رد المحتار: ٥/٦٥٦،
سعيد)
Allāh ta'ālā knows best.
When an owner includes his son in a mudarabah agreement
Question
Zayd gave R100 000.00 as mudarabah to 'Umar. They agreed that 30%
of the profit will be for the owner and 60% for the mudarab. The
owner's son will work with the mudarab as a manager, and he will
receive 10% of the profit. Is this arrangement permissible?
Answer
It is correct and permissible to specify the profits on a percentage
basis. It is also correct for the owner to appoint his son as the
manager, and he too will get 10% of the profit. In this mudarabah
agreement, the owner's son will be like an outsider, and it is
858