Gold and Silver Part 01


Economics, Part 5-Principles of Business

1. There are several ways of purchasing gold and silver. One is that gold could be purchased in exchange for gold or silver in exchange for silver, e.g. a person purchases gold with a gold coin which he has in his possession or silver with a silver coin which he has in his possession. In other words, the item that is being purchased is of the same category as that with which it is being purchased. In such a case, two factors are wajib :    (i) the gold or the silver on both sides will have to be equal, (ii) the transaction must be complete before the buyer and the seller can separate, there must be no outstanding amount. If they conduct this transaction contrary to any of these two factors, it will be interest. For example, if you purchase silver with a R1 coin (which is made of silver), you will have to purchase the silver that is equal in weight as that of the R1 coin. If it is more or less than the R1 coin, it will be interest.

June 4, 2010

Purchasing an item without seeing it


Economics, Part 5-Principles of Business

1. A person purchases an item without having seen it. This transaction is valid. However, once he sees the item, he has the right to return it or keep it. This is irrespective of whether there is any defect in the item or not. Even if the item is exactly as he had envisaged it to be, he still has the right to return it or keep it.

2. A person sold an item without even looking at it. This person who sells the item does not have the right to take it back after he sees it. Only the buyer has the right of returning an item after seeing it.

May 20, 2010

Purchasing on credit


Economics, Part 5-Principles of Business

1. It is permissible to purchase an item on credit. However, it is necessary to specify a period of time, i.e. you will pay the amount after 15 days, after one month or after four months – whatever the case may be. If a person does not specify any period but merely says: “I don’t have the money now, I will pay you later”, this has two aspects to it:

(i) He says: “I will purchase this on condition that I will pay you later.” In such a case the transaction will be invalid (faasid).

May 18, 2010

Having knowledge of the item that is to be purchased


Economics, Part 5-Principles of Business

1. When purchasing dry groceries, seeds, etc. a person has the choice of purchasing it after having it properly weighed or he could say:   “I am buying a certain amount of wheat for R1.” Alternatively, he could purchase it as it is (i.e. without having it weighed nor specifying any amount) and say:    “I am buying this heap of wheat for R1.” No matter how much of wheat may be in that heap, all will belong to him (once he purchases it).

May 13, 2010

Oaths Related to Buying and Selling


Bahishti Zewar, Fiqh, Part 3-Fasting, Zakaat, Qurbani, Hajj etc.

1. A person took an oath that he will not purchase a
certain item. Thereafter he asked someone to purchase it for him. If that person
purchases it, his oath will not break. Similarly, a person took an oath that he
will not sell a certain item of his. Thereafter, he asked someone to sell it for
him. If that person sells it, his oath will not break. The same rule will apply
to rental transactions. If he took an oath that he will not rent a particular
house, and thereafter took it on rent through someone else, his oath will not
break.

August 31, 2008