Muzâra‘ah – Temporary sharecropping contract

Bahishti Zewar, Fiqh, Part 5-Principles of Business

1. A person gave an empty piece of land to another person telling him: “You cultivate this land. Whatever you harvest will be divided between us according to a certain percentage.” This is known as muzâra’ah and is permissible.

2. A person cultivated a piece of land and said to another person: “You irrigate this land, tend to it and do whatever else is necessary. Whatever fruit is produced, irrespective of whether it is up to one-two years or 10-12 years, we will share it between ourselves either equally (i.e. 50% each) or by dividing it in thirds (or whatever the percentage may be).” This is known as musâqât and is also permissible.

November 26, 2010

Annulment of a rental contract

Bahishti Zewar, Fiqh, Part 5-Principles of Business

1. A person took a house on rent. However, it leaks profusely, a certain portion of it collapsed or any other fault became apparent which makes it difficult to live in. In such cases, it is permissible to annul the rental contract. And if the house becomes absolutely dilapidated and uninhabitable, the rental contract will be annulled on its own. There is no need for you to request an annulment nor is it necessary to obtain the consent and agreement of the landlord.

2. If the landlord or the tenant passes away, the rental contract becomes annulled.

October 30, 2010

Improper leasing or hiring out

Bahishti Zewar, Fiqh, Part 5-Principles of Business

1. The following methods of hiring out are regarded as ijârah fâsidah (improper leasing):
(a) At the time of renting a house, the period was not specified as to how long the house will be rented.
(b) The rental was not specified. The person merely occupied the house and began living in it.
(c) The tenant made this condition that he will pay the costs for whatever breaks in the house.
(d) The landlord rented the house on the condition that whatever breaks in the house will have to be repaired by the tenant and that the repairs that he will undertake will actually be his method of payment of the rental. But if the landlord says: “You live in this house and undertake whatever repairs are necessary. There is no rental to be paid.” In such a case this is an aariyah (a loan). This is permissible.

October 26, 2010

How To Calculate Zakah On Business

Contemporary Fatawa, Fiqh

Is zakat payable on business? If so, how does one calculate the amount? I have overdrafts and loans in business too, as well as receivables outstanding.

(2) Is zakat payble on stocks? I have stocks from various periods starting from 30 days to over 365 days. There are certain stocks which are not sellable anymore.
(M.G.Y. Karachi)

A. First of All, you should set a particular date of a lunar month for the valuation of your assets for the purpose of zakah. Better you choose the first of Ramadaan for this purpose, because this is the date on which the government also collects zakah from all the citizens. This date will be your zakah valuation date for each year as long as you remain sahib-e-nisab (the one on whom zakah is obligatory).

April 23, 2010