A permissible and impermissible form of transacting
Question
Please advise which of the following is permissible:
1. A person buys an asset and then sells it to a customer for a profit on terms. For example, he buys a truck for R2,000,000 and sells it for R4,000,000 fixed price over 5 years. Buyer is aware of this and is willing to pay the R4,000,000. Would this be permissible?
2. A person buys an asset and sells it to customer for the capital + profit earned on the asset during the agreed capital re-payment period. For example, he buys a truck for R2,000,000. Sells the truck for agreed R2,000,000 over 5 years + pays him the profit he makes while using that truck in his business over those 5 years. The profit varies based on the business he does each month and there is possibility of loss also. At the end of the 5 years the truck belongs to the buyer, and he stops sharing profit. The seller of the asset is made well aware of the risks. Would this be permissible?
Answer
1. Yes.
2. No.
And Allah Ta'ala (الله تعالى) knows best.
- Answered by
- Mufti Ebrahim Salejee (Isipingo Beach)
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