Leasing Out The Purchased Asset To The Person Who Sold It Expressly and Implicitly

Leasing out the Purchased Asset
to the Person who Sold it

(Expressly and Implicitly)
Dr. Nazeeh Kamaal Hammaad1
1 Dr. Nazeeh Kamaal Hammaad was formerly professor of Islamic Jurisprudence

and Sources of Islamic Jurisprudence at Sharee'ah College, Umm Ql-Quraa
University, Makkah; he is currently the legal advisor in a number of Islamic banks
and monetary institutions.
Leasing out the Purchased Asset to the Person who Sold it
All praise is due to Allah, and may Allah's peace and blessings be
upon Allah's Messenger, who was sent as a mercy to all the worlds, as
well as upon his pure family and noble companions, and all those who
follow into their footsteps until the Day of Resurrection.
Leasing the purchased asset to the person who sold it may take place
explicitly, in which case a person, for instance, sells an operational asset
which he owns, such as a building, a motor car or an aeroplane, and
then takes it on lease from him for a month, a year, three years, etc. It
may also take place implicitly, an example of which is when a person
sells such asset and makes an exception of its use for a period of time
because the exception of its use does in actual fact constitute an equal
counter-value for the exception. This point is detailed below.
I. Leasing an Asset to the Person who Sold it

Expressly
The purchaser may give the asset he purchased from the person who
sold it to him on lease expressly. In fact such a lease can either be
operational2 or one which ultimately with ownership (ijaarah muntahiya
bittamlik)3. This point is explained as follows.
A. Leasing out an Operational Asset to the Person who Sold it
This involves the following three cases:
2 Islamic banks use the lease for the usufruct as an instrument of financing. The bank
purchases the asset and rents it out to the customer in return for rental. In the model of
ijaarah known as 'operational lease' or 'financial lease' the bank purchases and
maintains assets which have a high degree of marketability. The bank rents these
assets to other parties on terms and conditions agreed upon for a specific time. After
the termination of the period the asset is returned to the bank. The bank then leases
the same asset to a new lessee. The bank bears the risk of recession or diminishing
demand for these assets. In the end the bank may choose to scrap or dispose the asset.
[Translator's Note]
3 Ijaarah muntahiya bittamleek (also known as ijarah wa iqtina’, "rent-to-own purchase" or
"lease purchase") is a form of leasing contract which includes a promise by the lessor
to transfer the ownership in the leased property to the lessee, either at the end of the
term of the ijaarah period or by stages during the term of the contract, such transfer of
the ownership being executed through one of the means specified in the standard.
[Translator's Note]
8 Al-Adl (35)
Dr. Nazeeh Kamaal Hammaad
a. The lease takes place without prior agreement or any conditions

laid down in the sale contract
Muslim jurists are agreed that leasing in this case is absolutely
permissible because the main principle is that it is permissible to give
the purchased asset on lease (if it is operational and can be used without
being subjected to damage) to the person who sold it or any other
person. This can be concluded with a lease contract following the sale
contract on condition it takes place without any agreement whatsoever
before the conclusion of the contract or any conditions stipulated in the
contract.
b. The lease may be stipulated as a condition in the sale contract
An example of this is when the owner sells his building, motor car or
an aeroplane, for instance, on condition that he takes it on hire for five
years at an agreed rental fee from the lessor to be paid on agreed
instalments, monthly, yearly or as agreed between the intended parties.
Muslim jurists, however, have expressed two different opinions in
this regard. The majority of jurists from amongst the Hanafites,
Shaafi'ites and Hanbalites maintain that such a contract is not
permissible because it contains the so-called 'aqd fee 'aqd' or 'contract
within contract', and this clearly represents the form of contract
commonly known among jurists as 'Bai'ataan fee bai'ah,4 which is strictly
forbidden.5
The Maalikites, as well as Ibn Taymiyyah, who is a Hanbalite
scholar, have, however, opposed this opinion, stating that such
definition does in no way apply to the so-called 'bai'ataan fee bai'ah', and
refusing to consider the forms and applications under which they fall.
Rather, they plainly stated that it is absolutely permissible to stipulate
the condition of leasing in a sale contract, selling in a sale contract,
leasing in a lease contract, or even marriage in a sale contract, etc. They
also argue that stipulating a condition of a contract in a contract is
certainly permissible as long as it serves to realize a certain benefit
(manfa'ah) and does not contain anything that contradicts the [command
4 This applies to a situation in which a person sells merchandise for certain price in cash
on condition that the buyer will sell it back to him at a higher price on credit. Thus the
first seller borrows a certain amount of money to be paid back with an increment
(ribaa) sometime after. It is one of the contrivances to legitimize ribaa. [Translator's
Note]
5 Al-Mughnee, 6/332-3; Kash-shaaf Al-Qinaa', 3/181.
Al-Adl (35) 9
of] Allah and His Messenger. The general principle is that all conditions
laid down in contracts are valid as long as they do not go against the
Sharee'ah, and that anything that serves to realize benefits and is not
prohibited by Allah or His Messenger is definitely lawful and no one
has the right to make it unlawful. 6 This is the preponderant opinion in
my view.
Judge Ibn Al-'Arabee writes, "If [someone] says to you, 'I will sell
you my slave for one thousand on condition that you sell me your house
for one thousand', then this is absolutely permissible and acceptable.
Abu Haneefah said that if [someone] sells [another person] his salve on
condition the purchaser sells him another slave at the same price, then
this is not permissible; in fact, [I believe that] there is nothing more
permissible than this, for each party has produced a slave, and this is
absolutely acceptable.7
In Al-Mudawwanah, we read, "I said, 'What [will the ruling be] if I
buy a slave form a man for ten dinaars8 on condition that I sell him my
slave for ten dinaars?' He replied, [Imaam] Maalik said [in this regard],
'This is permissible.'"9
We also read, "I said, 'What if I sell him my slave for ten dinaaras on
condition that he sells me his slave for twenty dinaars?' He replied,
'[Imaam] Maalik said [in this regard]: There in no harm in this, for this
involves [an agreement of exchanging] a slave with a slave with the
addition of ten more dinaars.'"10
Ibn Taymiyyah also writes, "His argument, 'The statement: I will sell
you my clothes for one hundred on condition that you sell me your
clothes for one hundred; if they intend [by saying this] to sell their
clothes and reach an agreement in this regard, then this is certainly
similar to shighaar marriage11.' But what is the evidence for the invalidity
6 See Ibn Taymiyyah, Nadhariyyat Al-'Aqdi, p. 227; Al-BA'lee, Al-Ikhtiyyaaraat Al-

Fiqhiyyah Min Fataawaa Ibn Taymiyyah, p. 123.
7 'Aaaridhat Al-Ahwadhee, 5/241.
8 A dinaar is a monetary unit. Tech: Gold coin weighing one mithqaal, equivalent to 4.25
grams. [Translator's Note]

9 Al-Mudawwanah, 9/126.
10 Ibid.
11 Shighaar marriage is a double treaty of marriage which was common amongst the
pagan Arabs, viz, the man marrying the sister or daughter of another and in return
10 Al-Adl (35)
of such agreement? In fact, this is similar to one's saying, 'I will lease out
my house to you for one hundred on condition that your house will be
leased out to me for one hundred.' The equal counter value ('iwadh) of
both leases is one hundred and the lasing out of the house; similarly, the
equal counter value of the sale is one hundred and the selling of the
house. To prohibit [such agreement] requires a text [from the Qur'an or
the Sunnah] or ijmaa12' whereby qiyyaas13 can be carried out."14
He also writes, "It is absolutely permissible to combine marriage and
sale in one single contract, in which case a condition [to this effect] is
laid down in one of the contracts so much so that the acceptor cannot
accept the offer in any one of them without accepting the other, because
the contractor will not be satisfied without having both of them
accepted. An example of this is when he sells two commodities at the
same price; in this case, he will not accept one without accepting the
other."15
He also writes, "If the seller combines two contracts with two
quantitatively distinct contracts and with distinct equal counter-values
('iwadh), then the buyer will certainly not accept one of them with its
equal counter-value."16
It is obvious that the examples furnished by Muslim jurists in the
previous quotations clearly demonstrate the validity of stipulating a
condition of one contract in another, in which case "the subject matter
(ma'qood 'alaih) in each one of the contracts is not the same as the other".
For example, "I will sell you my house for such-and-such an amount on
condition that you sell me your car for such-and-such and amount", or "I
will lease out my house for such-and-such and amount on condition that
you lease out your house for such-and-such and amount". This ruling
does certainly apply to the case under study, in which case the subject
giving his sister or daughter in order to avoid paying the usual dower. This type of
marriage is strictly forbidden in Islam. [Translator's Note]
12 'Consensus of opinion'. Usually defined as the unanimous agreement of the
mujtahidoon (erudite scholars who exercise ijtihaad, or independent reasoning;

analytical thought) of any period following the demise of the Prophet Muhammad on
any matter. As such, it is described as collective ijtihaad
13 This means 'deduction by analogy'. [Translator's Note]
14 Ibn Taymiyyah, Nadhariyyat Al-'Aqd, p. 189.
15 Ibid. P. 191.
16 Al-Ba'lee, Al-Ikhtiyyaaraat Al-Fiqhiyyah Min Fataawaa Ibn Taymiyyah, p. 122.
Al-Adl (35) 11
matter in both contracts relates to the same asset; an example of this is: "I
will sell you my house for such-and-such an amount on condition that
you lease it out to me for two years for such-and-such an amount". The
reason for this is that the description on which the ruling is conditional,
namely the condition of including a contract within another contract, in
both cases is the same, and the influencing difference between them is
absent. Clarification and support for this is as follows:
1. In his book Al-Istikhraaj Fee Ahkaam Al-Kharaaj, Ibn Rajab writes
regarding ardh al-kharaaj17 about which its owners made peace with
Muslims on condition that such lands remain in their possession in
return for paying land taxes on them to the Muslims, "Ardh al-kharaaj of
which non-Muslims are in possession are of two types. The first type
concerns the lands regarding which they made peace with us and admit
they belong to us, but they remain in their possession while paying land
taxes on them to us…The fact of the matter is that we have owned these
lands on condition that we lease them out to them. Sheikh Abu Al-
'Abbaas Ibn Taymiyyah said [in this regard], 'The evidence for the
permissibility of [such agreement] is cogent in sales matters, for if we
consider the purchase of the land permissible while its usufruct remains
solely for the seller without an equal counter-value or recompense
('iwadh), it is all the more so with 'iwadh, in which case we have a
combination of two contracts.' Ibn 'Aqeel has also furnished cogent
evidence as to the validity of a single contract in which there is a
combination of selling commodities and taking them on lease from the
purchaser for a certain period of time; as this [agreement is deemed]
valid and permissible, the case in which the buyer leases out [a certain
asset] should all the more be valid and permissible."18
2. Judge 'Abdul-Wahaab Al-Baghdaadee, as well as the well-known
judge ibn Al-'Arabee, Al-Wanshareesee and others amongst the
maalikties have considered selling a riding animal permissible on
condition that the seller rides it not for a short period of time. They
argue that the rationale behind the permissibility is that the seller has
stipulated the condition that the purchaser agrees to give it to him on
lease for that period because there is no contradiction whatsoever in a
17 Lands in possession of dhimmis in exchange for land taxes. Also known as dhimmah
lands. [Translator's Note]
18 Al-Istikhraaj Li Ahkaam Al-Kharaaj, pp. 246-7.
12 Al-Adl (35)
sale contract in which the condition of taking the asset on lease from the
purchaser has been laid down, in total conformity with their principles.19
Judge 'Abdul-Wahhaab writes in Al-Furooq, "There is a difference
between two things: [Imaam] Maalik said regarding the person who sold
a riding animal and excluded riding it, 'If it is only for a short period of
time, such as one or two days, then [doing so] is permissible; but if it is
for a long period of time, then it is not so; however, if he stipulates the
condition of riding it, it is permissible, whether or not this lasts for a
short or long period of time. In both cases, the riding is included in the
sale. The difference between these two matters is that if he excludes
riding it and this lasts for a long period of time, then gharar20 is certainly
involved in the sale because the buyer receives the riding animal only
after the riding period is over even though it remains in his possession.
This is not the case if he stipulates the condition of riding it, because in
this case the buyer receives the riding animal and only gives it on lease
to him, thus combining both sale and lease; for it is permissible to
combine sale and lease as they do not constitute two contradictory
contracts."21
c. There could be some kind of agreement prior to the conclusion
of the contract to lease out the asset to the person who sold it
This takes the form of an agreement in the preliminary discussion
prior to the conclusion of the contract between the intended parties in
which the first party agrees to sell the asset he owns to another person
and then takes it on lease from him through a separate lease contract at
an agreed price for a specific period of time.
This point, however, calls for an explanation of the word
muwwaata'ah (agreement, collusion), as it is part in this case.
19 Al-Wanshareesee, 'Uddat Al-Burooq, p. 418; Abul-Fadhl Ad-Dimashqee, Al-Furooq Al-

Fiqhiyyah, p. 80; 'Aaridhat Al-Ahwadhee, 6/10.
20 Gharar: A deceptive or unclear practice. The Arabic root means deception. The term
covers a range of unacceptable business practices which range from fraud, to market
manipulation, to taking advantage of a consumer. For instance, any contractual
situation in which one party stands to be disadvantaged due to ignorance or
incomplete information is subject to gharar, and not acceptable in the Sharee'ah. Islamic
protections against gharar are very similar to Western consumer protection statutes.
[Translator's Note]
21 Judge 'Abdul-Wahhaab Al-Baghdaadee, Al-Furooq, p. 85.
Al-Adl (35) 13
Linguistically, muwwaata'ah means 'agreement'22. In Faaris said,

"Muwwata'ah means agreement on a certain thing, which is reached by
two people."23
Technically, muwwaata'ah denotes a number of things including the
following:
1. The express or purported agreement of two parties to secretly
resort to tricks or usurious means in the form of legal contracts in order
to render lawful what Allah has clearly declared forbidden.
2. Resorting to pious fraud whereby the two parties reveal a
contract which they do not really intend in their hearts to honour,
commonly known as talji'ah, or fictitious sale.
3. Secret agreement between two parties to engage in a legal
practice or dealing with a view to using it as a legal outlet (the so-called
'commendable trick').
4. The agreement of the two parties during the preliminary
negotiations prior to the conclusion of the deal which consists of a
number of successive and correlated contracts and pledges in
accordance with certain conditions which control them as a single
system which aims at performing a specific intended function following
the conclusion of the contract in the manner agreed upon. This basically
applies to the new financial transactions.
Indeed, Muslim jurists have indicated that muwwaata'ah can be
explicitly expressed or understood according to the general prevailing
customs and traditions or circumstantial proofs, especially collusion
involving tricks and usurious means.
Ibn Taymiyyah and his disciple Ibn Al-Qayyim said in this regard,
"…If he sells him [an asset] through usurious means at a certain price
and [the other party] wants to buy [the asset] from him at its price from
its kind, he can either agree with him on such a sale verbally or
according to the prevailing customs, or may not agree with him
altogether. If he agrees with him [verbally], then [the sale] is legally
invalid, for [the first party] does not intend to be in possession of the
price, nor does the [other party] intend to invest him with its possession
but rather make him possess the priced asset with the same asset; they
22 Ibn Al-Atheer, An-Nihaayah, 5/201-2; Al-Qaamoos Al-Muheet, p. 71; and Al-Misbaah Al-
Muneer, 2/830.
23 Mu'jam Maqaayees Al-Lughah, 6/121.
14 Al-Adl (35)
have only used the word 'price' as way of deception that actually leads
to a usurious transaction. In this way, he is just like the case of the
"breeding bull" in the marriage contract which is concluded to make a
woman lawful to her husband.24 If however, no collusion between takes
place, but the purchaser knows full well that the seller want to buy from
him on the basis of usury, this is also invalid, as it represents a form of
collusion according to the prevailing customs."25
It is worth mentioning here that collusion in matters relating to
binding contracts and pledges has three characteristics from a juristic
point of view, namely
1. It is in effect an agreement between two parties to conclude
contracts and execute pledges for the future.
2. This agreement is tantamount to the condition preceding
contracts and pledges and is also subject to rulings relating to it in terms
of permissibility and prohibition, validity and irregularity, necessity and
enforceability. Ibn Taymiyyah writes, "If they agree on a certain matter
and then conclude the contract, then what they have agreed upon has to
be accomplished."26
3. The factor binding collusion is actually the same factor binding
the condition or conditions agreed upon before the conclusion of the
contract. It is well-known that the condition agreed upon before the
conclusion of the contract has the same weight as the condition laid
down in the contract itself in terms of the legal validity, the necessity of
24 A man who pronounces divorce upon his wife three times cannot, under any
circumstances, return to her husband until she has been married and enjoyed and
divorced by another husband. Marriage should be established with true intention of
getting married, not just make the wife lawful. Marrying only to make the wife lawful
for her husband is a major sin. This is exactly what the muhallil (second husband who
married a divorced woman for this reason) does. Marriage with such an intention is
not valid. Ibn Maajah reported that the Prophet (may Allah's peace and blessings be
upon him) said, "Shall I tell you who the borrowed bull is?" They replied, "Please do,
Messenger of Allah." He said, "That is the muhallil. Cursed the second husband who
makes the [divorced] wife lawful for her first husband, and cursed be the first
husband for whom she is made lawful." A borrowed bull is used here figuratively,
based on the Arab tradition of borrowing a stallion for breeding purposes and then
returning it to its owner.
25 Ibn Taymiyyah, Bayaan Ad-Daleel 'Alaa Butlaan At-Tahleel, p. 284; Ibn Al-Qayyim,
I'laam Al-Muwwaqqi'een, 3/242.

26 Ibn Taymiyyah, Nadhariyyat Al-'Aqd, p. 204.
Al-Adl (35) 15
honouring the terms of the contract, invalidity and cancellation,

according to the most correct view of Muslim jurists, namely that of the
Maalikites and Hanbalites. Therefore, if they agree on a certain matter
and then conclude the contract, then what is to be accomplished is that
which they have customarily agreed upon, for there is no difference
whatsoever between the conditions laid down in the contract itself and
the conditions agreed upon before the conclusion of the contract even if
such conditions are not explicitly expressed during the conclusion of the
contract as long as the contract depends on them and is concluded on
their basis. Indeed, the obvious condition is equivalent to the expressed
one, the verbal condition is just like the conventional condition and
intents in contracts are to be considered. 27
Ibn Taymiyyah writes, "The well-known view of [imaam] Ahmad
[derived from] his texts and principles, as well as that adopted by his
old companions, such as those who resided in Madeenah, is that the
condition preceding the contract is in actual fact equivalent in force to
the condition laid down in the contract itself; therefore, if they both
agree on a certain deal and then conclude the contract, it will take effect
in accordance with what they have agreed upon following the general
prevailing customs…In fact all contracts take effect according to the
general prevailing customs with which the two contracting parties are
familiar."28 He also writes, "The basic principle of the school [of
jurisprudence] is that the conditions preceding the conclusion of the
contract have the same weight as those stipulated in the contract itself;
therefore, if they (i.e. contracting parties) agree on a certain deal and
then conclude the contract, the contract will take effect depending on
what they have agreed upon."29
Following the foregoing argument, leasing out an asset to the person
who sold it on the basis of the prior agreement is for all practical
purposes the same as giving it on lease to him on the basis of the
condition laid down in the sale contract. This practice is considered
27 I'laam Al-Muwwaqqi'een, 3/105, 145, 212 and 241; Kash-shaaf Al-Qinaa', 5/98; Bayaan
Ad-Daleel 'Alaa utlaan At-Tahleel, p. 533; Majmoo' Fataawaa Ibn Taymiyyah, 29/336; Ibn
Taymiyyah's Al-Fataawaa Al-Kubraa, 4/108; Ahmad Ibraaheem, Al-'Uqood Wash-
Shuroot Wal-Khiyyaraat, p. 711; Az-Zarqaa, Al-Madkhal Al-Fiqhee Al-'Aam, 1/487.
28 Al-Fataawaa Al-Kubraa, 4/108.
29 Nadhariyyat Al-'Aqd, p. 204.
16 Al-Adl (35)
permissible according to the Maalikites and Ibn Taymiyyah from among

the Hanbalites, as has been explained in the second case previously
mentioned.
II. Leasing out the Asset that ends with Ownership

to the Person who Sold it
This issue involves the following two cases:
a. The lease takes place following an agreement prior to the
conclusion of the contract or the stipulation of a condition in the
contract itself
We have previously explained that muwwaata'ah and like terms
refers to an agreement which precedes the conclusion of the contract,
which has the same weight as the condition stipulated in the contract
itself and which has the same ruling as that of the condition laid down
in the contract in terms of validity, the necessity of honouring the terms
of the contract, invalidity or cancellation, according to the most correct
view of Muslim jurists.
It is worth mentioning here that the type of leasing known as ijaarah
muntahiya bittamleek ("rent-to-own purchase" or "lease purchase") is in
itself a transaction which consists of a number of successive and
correlated contracts and pledges which aim at realising a financial
objective, which begins with leasing out the asset and ends with the
lessee's acquisition of ownership following the end of the lease period
after all the instalments have been paid, either automatically in return
for the money he paid towards the rent or through a separate gift
contract ('aqd hiba)30 following the lease contract, through a sale contract
for a specific real or nominal price conditional on the payment of the
whole asset rental agreed upon, among other things.
In fact, such transaction takes various practical forms in the
international market, some of which are considered in Islamic
jurisprudence as fairly permissible while others are deemed invalid.
We will, however, confine ourselves in the present study to the
permissible form of such transactions, an example of which is the one
declared by the Council of the Islamic Fiqh Academy, resolution no. 110
30 ِA gift contract is a contract under which a donor gives its own property to a donee
gratuitously and the donee expresses its acceptance. [Translator's Note]
Al-Adl (35) 17
(12/4), in its twelfth session held in Riyadh in the period 23-28

September, 2000, thus: "Thirdly: Some permissible Forms of the
Contract: A lease contract that enables the lessee to make use of the
leased asset against a specific amount of rent and for a specific period of
time, along with a separate contract offering the asset as a gift to the
lessee. The latter contract becomes effective at the end of the lease period
and when the lessee has paid off all the amounts of rent agreed upon. A
promise from the owner to give the asset as a gift to the lessee, after the
lease period and full payment of due rent, is also acceptable ( as per
Resolution No. 13/1/3 on Hibah which has been passed by the Council
in its Third Session)."
As a matter of fact, this form is a financial method which is carried
out through a contractual contract which consists of interrelated
correlated contracts and promissory pledges, in successive phases, in
which the contracting parties agree that the owner leases out the asset
(or any operational asset for that matter) to the other party against a
specific amount of rent and for a specific period of time, on condition
that ownership of the asset is transferred to the lessee through a gift
contract following the lease contract, to be concluded in the future (at
the end of the lease period) and conditional upon the payment of all the
due instalments, or through a binding pledge to give it as a gift
following the end of the lease period along with the full payment of all
due instalments.
Therefore, it is a new single transaction with a specific financial
objective, which begins with leasing out the asset and ends with
transferring its ownership to the lessee, as explained above. The
rationale behind such a transaction is to offer a legitimate alternative to
the financing project based on usurious interest. It is in fact a trick (or
rather a way out) to transfer ownership of the specific asset against a
deferred price to be paid on specific instalments and for a specific period
of time with the condition of protecting the seller against the risk of
losing the deferred instalments and his failure to collect them in case of
the other party's bankruptcy, procrastination or failure to honour the
contract for any reason by leaving the asset in his possession until he
pays off the deferred price in full. According to this financial system,
once he manages to do this at the end of the lease period, ownership of
18 Al-Adl (35)
the asset is transferred to him through a separate gift contract following

the lease contract.
This form of transaction is, in my opinion, permissible as long as it is
regulated by the criteria laid down by the Council of the Islamic Fiqh
Academy, namely,
1. There should be two separate contracts which are concluded at
different times in such a manner that the conclusion of the gift contract
or pledge to give it comes after the conclusion of the lease contract.
2. The lease should be actual and not intended to conceal the sale.
3. The liability of the leased asset should fall on the owner, not on
the lessee.
4. If the contract includes insurance of the leased asset, such
insurance must be cooperative and Sharee'ah-compliant and not
commercial; and the premium thereof must be borne by the lessor, and
not by the lessee.
5. Leasing rulings must apply to the lease contract which ends with
ownership throughout the lease period.
6. Non-operational maintenance fees should be borne by the lessor
and not by the lessee throughout the lease period.
In fact, this financial system constitutes a trick to transfer ownership
with deferred payment (on instalments) and guarantees full payment of
all due instalments in case of the other party's bankruptcy,
procrastination on paying off instalments or failure to honour the terms
of the contract for any reason, by combining the lease contract with the
following gift contract in these correlated transaction which consists of
successive phases in accordance with a system that regulates it as a
single transaction that does not allow dissociation and disconnection,
and which aims at realising a specific objective upon which the
contracting parties have agreed to achieve.
From an Islamic point of view, such a transaction is absolutely
permissible as long as it does not render a prohibited practice lawful,
invalidate a right or omit an obligation. Furthermore, it does not consist
of any form of injustice or devouring people's wealth by false means;
rather it provides a general benefit which is sanctioned by the Sharee'ah
itself, namely protecting the rights and payments of the contracting
parties in financial reciprocity contracts against loss and failure to
honour the terms of the contract with the aim of realising justice
Al-Adl (35) 19
between the two parties in terms of rights and the obligations resulting
from the conclusion of contracts.
It is for this reason that such a transaction is considered as one of the
'commendable tricks' and legitimate 'outlets' which has been sanctioned
by the Sharee'ah. Imaam Ibn Al-Qayyim says in this regard, "Tricks are of
two types: A type whereby one manages to do what Almighty Allah has
commanded, leave what He has prohibited, get rid of unlawful
practices, liberate the right from the oppressors who prevent it and
liberate the wronged from the oppressive tyrants; in fact such is type is
certainly commendable for which the person who does it as well as the
person who teaches it will get rewarded. The [second] type includes the
omission of obligations, rendering prohibited practices lawful,
considering the wronged person a tyrant and the tyrant a victim, and
treating the truth as falsehood and falsehood as the truth. In fact the
[righteous] predecessors have all agreed that [such a trick] is highly
objectionable."31
He also writes, "Therefore, a trick is judged according to the reason
for which it is used, in terms of permissibility or prohibition, benefit or
harm and whether is represents an act of obedience or disobedience [to
the Lord]. Thus, if the act behind it is good, the trick [used to achieve it]
is definitely good; however, if the act behind it is evil, then the trick
[used to achieve it] is certainly evil."32
Regarding the issue of leasing out the asset to the person who sold it
in such a manner as to end with ownership based on a prior collusion or
a condition laid down in the sale contract, we can say that such an issue
is very serious indeed and requires reflection, especially given its
contemporary forms and applications in the so-called Islamic financial
institutions and the extent of its conformity with the principles of
'blocking the means'33 and 'invalidating usurious tricks'.
After much contemplation and deep thinking regarding the reality of
this correlated contractual system which does not allow dissociation and
disconnection as well as the intents and consequences of the contracting
31 Ibn Qayyim Al-Jawziyyah, Ighaathat Al-Lahfaan, 1/339.

32 Ibn Qayyim Al-Jawziyyah, Ighaathat Al-Lahfaan, 1/385.
33 The principle of 'blocking the means' (sadd ad-daraa'i') states that anything that leads to
something prohibited is itself prohibited. [Translator's Note]
20 Al-Adl (35)
parties behind its conclusion, I have come to realise that the two parties'
agreement which states that one of them sells his operational asset
(whose usufruct can be utilised while its essence remains the same) at a
price paid in advance and then he takes this asset on lease form the
person to whom he has sold it in such a manner as to acquire its
ownership for a specific payment which may be deferred or paid on
instalments and which is far more than the price paid in advance at
which he has sold it to him. In fact such a transaction clearly involves
concealment of their intentions to engage in a usurious trick which can
be realised by combining two legitimate contracts concluded separately
but forbidden when combined, as they amount to a novel form of usury
known as ''aks al-'eenah'34; for with the conclusion of such a contract the
seller intends to recover the ownership of the asset he has sold from the
person who has bought it from him (on the pretext of this complex
contractual form described as ijaarah muntahiya bittamleek "lease-to-own
or capital lease") at a deferred price which is far more than the price paid
in advance at which he has sold it and has agreed with the purchaser in
advance upon this. Therefore, it is deemed prohibited and legally
invalid as it is used as a trick to effect a usurious loan, while "contracts
are essentially concluded by taking into account the intent behind their
conclusion without [considering] the forms of payments" 35 as has been
stated in Al-Qawaa'id Al-Kubraa.
34 'Eenah (sale and buy back agreement), as has been defined by the majority of Muslim
scholars, as selling a commodity to another person at a price paid in advance and then
purchasing it from him with far less cash than the price offered to buy it." See Al-
Maawardee, Al-Insaaf, 11/191; Ibn Qudaamah, Al-Mughnee, 6/260-2; and Ash-Sharh Al-
Kabeer 'Alaa Al-Muqni', 11/191-4. In fact, such a transaction is forbidden and is legally
invalid. 'Aks Al-'eenah' (reversal of sell and buy back agreement), however, means
"selling a commodity for a price that is paid in advance and then purchasing it at a far
higher price on credit." Al-Bahootee said, "It means to sell something in ready money
and then purchase it from the person who has bought it or from his representative at a
price that is far higher than the first one from its own type and not received." In fact,
this is similar to 'eenah as to its ruling; that is, it is forbidden, as they share the same
characteristics and both demonstrate the absence of the influencing difference. See Al-
Insaaf along with Ash-Sarh Al-Kabeer 'Alaa Al-Muqni', 11/195; Al-Bahootee, Sharh
Muntahaa Al-Iraadaat, 2/158; Al-Mughnee, 6/263; Kash-shaaf Al-Qinaa', 3/174; and
Majmoo' Fataawaa ibn Taymiyyah, 29/30.
35 Al-'Izz ibn 'Abdus-Salaam, Al-Qawaa'id Al-Kubraa, 2/230.
Al-Adl (35) 21
Imaam Ibn Al-Qayyim writes in this connection, "It is well-known

that usury, or riba, has not been forbidden due to its form or the words
used [in effecting it], but due to its true nature, implication and purport;
in fact, such true nature, implication and purport are based on usurious
tricks in the same way usury is expressly established, without any
distinction between them whatsoever; the contracting parties know this
full well, and those observing their conditions are also aware of this. In
fact, Allah is well aware that their intention is to effect a usurious
[transaction], but they have sought it through a contract, which they
have given it a false name and not its real name. It is well-known that
this [practice] by no means eliminates its prohibition, nor the harm for
which usurious transactions have been made forbidden; in fact, it makes
[such prohibition and harm] all the more clear-cut and definite."36
b. The lease takes place without an agreement prior to the
conclusion of the contract or the stipulation of a condition in the
contract itself
We have explained above that the owner's selling his asset at a price
paid in advance and then taking it on lease form the person who has
bought it from him in such a manner as to acquire its ownership for a
specific payment paid on instalments and which is far more than the
price paid in advance at which the asset has been sold through an
agreement before the conclusion of the contract or the stipulation of a
condition in the contract clearly reveals a novel form of usury known as
''aks al-'eenah'37; for with the conclusion of such a contract the seller
36 Ighaathat Al-Lahfaan, 1/352.

22 Al-Adl (35)
intends to recover the ownership of the asset he has sold, through the
contractual transaction described as ijaarah muntahiya bittamleek "lease-
to-own or capital lease", at a deferred price which is far more than the
price paid in advance at which he has sold it and has agreed with the
purchaser in advance upon this. Thus, it is tantamount to the usurious
form of transaction known as 'eenah sale (sell and buy back agreement)
in terms of its ruling, namely prohibition and legal invalidity, as they
both resort to a trick; that is, the usurious loan.
If, however, the lease takes place without the stipulation of any
conditions in the contract or an agreement prior to the conclusion of the
contract, then the ruling regarding 'aks al-'eenah' (reversal of sell and buy
back agreement) applies to it if it is effected without any collusion or
deception. Nevertheless, Muslim jurist have expressed two different
opinions in this regard:
1. Impermissibility in order to "block the means" to the usurious
loan. This was the opinion of Imaam Ahmad as has been narrated by
Harb from him as well as the view adopted by other Muslim scholars. 38
2. Permissibility: This is another view of Imaam Ahmad reported by
Abu Daawood and favourably accepted by Ibn Qudaamah who said, "It
is probable that it is permissible to purchase it (i.e. the asset which he
has sold at a price paid in advance) with the same type of price which is
higher than it (i.e. on credit) unless this has been effected through
collusion or deception, in which case it is deemed impermissible;
however, if this takes place through an agreement without intending
[collusion or deception], then it is absolutely permissible."39
The preponderant opinion in my view, however, is that it is
permissible, as there is no text or implied meaning to this effect and due
to the fact that those who oppose this opinion advance the principle of
"blocking the means [to evil]" in support of their view.
It has been established beyond any shadow of doubt that the
condition for implementing the principle of "blocking the means [to
evil]", according to scholars in the area of the fundamentals of Islamic

38 Ibn Qudaamah, Al-Mughnee, 6/263 Al-Qawaaneen Al-Fiqhiyyah, p. 276; Bidaayat Al-
Mujtahid, 2/142; Kash-shaaf Al-Qinaa', 3/175; and Al-Insaaf, 11/195.

39 Ibn Qudaamah, Al-Mughnee, 6/263. See also Al-Insaaf, 11/195 and Ash-Sharh Al-Kabeer
'Alaa Al-Miqni', 11/196.
Al-Adl (35) 23
jurisprudence, requires that the use of that which is permissible far

outweighs that of using that which is unlawful according to the
prevailing conditions, and that the suspicion becomes far stronger and
more apparent as to the intent behind that which is forbidden; if this
condition is not satisfied, then the principle of "blocking the means [to
evil]"40 must not be resorted to. Furthermore, it is clear that if such a
transaction is effected without resorting to deception, collusion or any
conditions whatsoever, suspicion as to the usurious loan involved in it
cannot be described as strong and apparent. Besides, resorting to it to
get to the usurious loan a transaction cannot be conceived to be far more
apparent according to the prevailing conditions. It is for this reason that
I do not consider the implementation of the principle of "blocking the
means [to evil]" in this way to be right, as evidenced by the erudite
scholar Muhammad At-Taahir Ibn 'Aashoor thus: "One of the things that
we must be aware of in [the area of] jurisprudence and independent
reasoning and analytical thought (ijtihaad) is the distinction between
excessiveness in religion and blocking the means to evil. In fact, this
distinction here is very subtle; for blocking the means to evil takes place
as a result of the existence of evil, while excessiveness in religion takes
places due to excessiveness in associating that which is mubaah41 with
something which is considered obligatory or forbidden in Islam, or in
engaging in a legal act with far more excessiveness than is intended by
the Legislator for fear of failing to act as the Legislator has intended us
to act; this is commonly known in the Sunnah as "tanattu'" (excessive
contention, transgression) and "ta'ammuq" (extravagance), and is divided
into different stages, some of which relate to piety and religiousness,
thus laying hardship upon oneself in religion or observing piety by
impelling others to lay hardship upon themselves in religion, and some
40Ash-Shaatibee writes in Al-Muwwafaqaat (4/198), "The principle of "blocking the

means [to evil]" which was implementedby Imaam Maalik in a number of juristic
issues because its essence is to use it when a lawful means is expected to produce an
unlawful result… However, this should take place on condition that an objective for
this becomes far more apparent among people according to the prevailing conditions."
See also Judge 'Abdul-Wahhaab, Al-Ma'oonah, 2/996; Judge 'Abdul-Wahhaab, Al-
Ishraaf, 2/560 and Ibn Shaas, 'Iqd Al-Jawaahir Ath-Thameenah, 2/441.
41This term denotes an action as neither forbidden nor recommended, and so religiously
neutral. This is one of the degrees of approval rulings in Islamic law. [Translator's
Note]
24 Al-Adl (35)
of it relate to the highly objectionable satanic whisperings. Therefore,

those involved in deducing the somewhat hidden meanings from
religious texts, as well as those who issue legal verdicts, must avoid
extravagance and excessiveness in inciting people to observe the
Sharee'ah rules and what they are required to do. This is a weighty
responsibility indeed."42
II. Leasing an Asset to the Person who Sold it

Implicitly
This form of transaction takes the following form: The owner sells
his operational asset to another person and excludes its usufruct for one
month, one year, five years, etc. because such exclusion in essence
constitutes an equal counter-value for what has been excluded (i.e. an
implicit lease of the asset from the person who has bought it), as such
usufruct is used against part of the price. 43 Therefore, the price of the
asset with the exclusion is less than the price without such exclusion.
The difference between the two prices serves as an equal counter-value
for the excluded usufruct. Some Muslim jurists have explained this thus,
"The stated usufruct is evaluated by a portion from the price of the
[asset] sold, and the sale is thus concluded by what has been
excluded."44
Nevertheless, Muslim jurists are not in agreement as to the ruling on
selling an asset with the exclusion of its usufruct for a specific period of
time. Three views have been advanced here:
1. The Hanafites and the Shaafi'ites consider such a transaction
invalid, arguing that the Prophet (may Allah's peace and blessings be
upon him) forbade concluding a sale and stipulating a condition in the
sale contract and also mention the hadeeth in which the Prophet (may
Allah's peace and blessings be upon him) forbade thunyaa (making
exceptions in the sale contract). They also argue that this condition is
42 Ibn 'Aashoor, Maqaasid Ash-Sharee'ah Al-Islaamiyyah, p. 370.

43 See Fath Al-Qadeer, 6/80; Az-Zaila'ee, Tabyeen Al-Haqaa'iq, 4/59; and 'Aaridhat Al-
Ahwadhee, 6/10.
44 Fath Al-Baaree, 5/319.
Al-Adl (35) 25
inconsistent with the requirements of a contract and is an example of

concluding "two transactions in one"45, which is legally prohibited.46
In refutation of their reasoning, it has been suggested that the report
about the prohibition of concluding a sale and stipulating a condition in
the sale contract has not been authentically attributed to The Prophet
(may Allah's peace and blessings be upon him), as many authoritative
scholars have declared, including Imaam Ahmad, Judge Ibn Al-'Arabee,
Al-Haafidh Ibn Hajar, Ibn Qudaamah and Ibn Taymiyyah and many
others.47 The hadeeth regarding thunyaa (making exceptions in the sale
contract) does not provide enough evidence for them because the full
text reads, "The Prophet (may Allah's peace and blessings upon him)
forbade thunyaa unless it is known."48 Therefore, this hadeeth makes it
clear that prohibition applies when something is not known, but in this
case it is fairly known49. In addition, the usufruct of the asset may be
excluded by the purchaser when he buys a pollinated date-palm,
cultivated land, leased house or a married female slave; so it is
permissible to exclude it, just like the purchaser's stipulation of using
fruit before pollination.50
Furthermore, stating that this matter is an example of concluding
"two transactions in one" is not right. In fact, Ibn Abul-'Izz Al-Hanafee
said, "The reason is that this exclusion amounts to the exclusion of
something which is known about the asset sold, and does not lead to
harm in ignorance, dispute or deception. Had the hadeeth narrated on the
45 Reportedby Ahmad, Al-Bazzaar and At-Tabaraanee on the authority of Ibn Mas'ood

(may Allah be pleased with him). Al-Haithamee said reading it, "Its transmittors are
reliable." See Musnad Ahmad, 1/198; Majma' Az-Zawaa'id, 4/84; Fath Al-Qadeer, 6/81;
and Nayl Al-Awtaar, 5/152.
46 At-Tahhaawee, MukhtasarIkhtilaaf Al-Fuqahaa', 3/136; Fath Al-Qadeer, 6/80; Tabyeen Al-
Haqaa'iq, 4/59; Rawdhat At-Taalibeen, 3/406; An-Nawawee 'Alaa Saheeh uslim, 11.30; An-
Nawawee's Al-Majmoo', 9/369 and 378; As-Sarkhasee's Al-Mabsoot, 13/14; Fath Al-
Baaree, 5/314; and Al-Istidhkaar, 5/306.
47 Fath Al-Baaree, 5/315-9; Al-Mughnee, 6/166; 'Aaridhat Al-Ahwadhee, 5/250; Ibn
Taymiyyah's Al-Fataawaa Al-Kubraa, 5/145.

48 Reportedby Abu Daawood, At-Tirmidhee and An-Nasaa'ee and its chain of
transmitters is classified as 'authentic' (Saheeh), as Al-Haafidh mentioned in Al-Fath. See

Sunan Abu Daawood, 2/235; 'Aaridhat Al-Ahwadhee, 5/290; Sunan An-Nasaa'ee, 7/260;
and Fath Al-Baaree, 5/315.
49 Al-Mughnee, 6/168; Fath Al-Baaree, 5/315.
50 Al-Mughnee, 6/168.
26 Al-Adl (35)
authority of Jaabir (may Allah be pleased with him) not been cited,
analogy would certainly decide the permissibility of such exclusion;
rather, the text comes in support of analogy and does not contradict it.
Therefore, this is not an example of concluding "two transactions in one"
but rather an example of exclusion."51
Perhaps the interpretation of concluding "two transactions in one"
provided by Sammaak, who is the narrator of the hadeeth prohibiting it,
supports and confirms this point. He said, "An example of this is when a
man sells something and says, 'This is for such-and such delayed
payment, and for such-and-such ready money.'"52 They depart without
specifying the price at which the purchaser has bought [the asset]. In
fact, Ash-Shaafi'ee, Ahmad and Abu 'Ubaid Al-Qaasim ibn Sallaam
agreed with Sammaak's interpretation53 as well as that provided by Ibn
Al-Qayyim, namely: A man sells an asset for one-hundred for a year on
condition that he buys it from him for eighty to be paid in advance. He
said, "In this case, he has combined the transaction of ready money and
that of payment on credit in one single transaction and one single sale.
In fact, his real intention is to sell immediate dirhams for far more dirhams
whose payment is deferred. He deserves nothing but his capital, and he
has incurred a loss in both deals; if he asks for more, then he has dealt in
usury (riba)."54 This interpretation is affirmed by the mawqoof hadeeth55
reported by Ibn Hibbaan, Ibn Abee Shaibah and At-Tabaraanee,
amongst others, which states, "Two transactions in one amounts to ribaa
(usury)."56
2. The second opinion is that held by the Maalikites who maintain
that such a transaction is impermissible if it takes place by way of
exclusion and the use of the excluded usufruct is considerable; however,
if the use of such usufruct is not much, such as selling a house and
51 Ibn Abul-'Izz Al-Hanafee, At-Tanbeeh 'Alaa Mushkilaat Al-Hidaayah, 4/384.

52 Ibn Al-Qayyim, Tahdheeb Mukhtasar Sunan Abee Daawod, 5/106; NAyl Al-Awtaar, 5/152.
53 Ibn Al-Hammaam, Fath Al-Qadeer, 6/81; Ash-Shawkaanee, As-Sayl Al-Jarraar, 3/61.
54Ibn Al-Qayyim, Tahdheeb Mukhtasar Sunan Abee Daawod, 5/106.
55 A hadeeth whose isnaad (chain of transmitters) goes back to the companion only.
[Translator's Note]
56 Al-Haithamee, Mawaarid Adh-Dham'aan, p. 272; Ibn Abee Shaibah, Al-Musannaf, 5/12;
At-Tabaraanee, Al-Mu'jam Al-Awsat, 2/169; Muntakhab Kanz Al-'Ummaal, 2/29; Saheeh

Ibn Hibbaan, 3/331; Fath Al-Qadeer, 6/80-1; Ibn Qudaamah, Al-Mughnee, 6/333; Al-
Bahootee, Sharh Muntahaa Al-Iraadaat, 2/163.
Al-Adl (35) 27
excludes living in it for a short period of time, like three days, a month
and a year, according to different opinions. The contract in this case is
legally valid because the slight use of the usufruct is tolerable and
forgivable.
However, if it takes place by way of stipulating a lease in a sale
contract, the sale is also permissible whether the condition stipulated
regarding the use of the usufruct is slight or considerable. 57 Maalik
(rahimahullaah) said, "There is no harm if the seller stipulates living in the
house he has sold for a specific period of time, whether it is a month or a
year as long as it does not occur at wide intervals; even if [the seller]
stipulates living in it for the rest of his life [and the buys agrees to this],
then there is no harm in this either."58
The evidence they cite in support of their view is the hadeeth narrated
by Jaabir (may Allah be pleased with him) who said that the Prophet
(may Allah's peace and blessings be upon him) had bought a camel from
him and he (i.e. Jaabir) stipulated riding it to [his house] in Madeenah. 59
Judge 'Abdul-Wahhaab Al-Baghdaadee, Al-Wanshareesee and
others have clarified the difference between excluding the use of the
usufruct and stipulating it thus, "The difference between these two
matters is that if he excludes riding it and this lasts for a long period of
57 Bidaayat Al-Mujtahid, 2/161; Al-Wanshareesee, 'Uddat Al-Burooq, p. 418; Abul-Fadhl

Ad-Dimashqee, Al-Furooq Al-Fiqhiyyah, p. 85; Ibn 'AbdAl-Barr, Al-Istidhkaar, 5/306;
Fath Al-Baaree, 5/314; Al-Mughnee, 6/167; An-Nawawee 'Alaa Saheeh Muslim, 11/30; An-
Nawawee, Al-Majmoo', 9/378; Al-Qawaaneen Al-Fiqhiyyah, p. 264; Ibn Daqeeq Al-'Eed,
Ihkaam Al-Ahkaam, 3/171.
58 Al-Istidhkaar, 5/305. See also Ibn Abee Yazeed Al-Qairawaanee, An-Nawaadhir Waz-
Ziyyaadaat, 6/330.
59 Al-Bukhaaree along with the commentary on the hadeeth in Fath Al-Baaree, 5/314;
Saheeh Muslim and An-Nawawee's commentary on the hadeeth, 11/30; Sunan An-
Nasaa'ee, 7/261-3; Musnad Ahmad, 3/229. The text of the hadeeth in Al-Bukhaare is:
Jaabir narrated, "While I was riding a [slow] and tired camel, the Prophet passed by,
beat it and prayed for Allah's Blessings for it. The camel became so fast as it had never
been before. The Prophet then said, 'Sell it to me for one uqiyyah [of gold].' I said, 'No.'
He again said, 'Sell it to me for one uqiyyah [of gold]." I sold it and stipulated that I
should ride it to my house. When we reached [Madeenah], I took that camel to the
Prophet and he gave me its price. I returned home but he sent for me [and when I
went to him] he said, 'I will not take your camel. Take your camel as a gift for you.'"
[Translator's Note]
28 Al-Adl (35)
time, then gharar60 is certainly involved in the sale because the buyer
receives the riding animal only after the riding period is over even
though it remains in his possession. This is not the case if he stipulates
riding it, because in this case the buyer receives the riding animal and
only gives it on lease to him, thus combining both sale and lease; for it is
permissible to combine sale and lease as they do not constitute two
contradictory contracts."61
3. The third opinion is the one held by the Hanbalites, namely, that it
is absolutely permissible to sell an asset and stipulate (or exclude) the
use of its usufruct for a specific period of time, because Jaabir (may
Allah be pleased with him) sold the Prophet (may Allah's peace and
blessings be upon him) a camel and stipulated riding it to [his house] in
Madeenah.62
Ibn Qudaamah writes, "It is permissible if the seller stipulates using
the usufruct of the sold asset for a specific period of time, such as selling
a house and stipulates living in it for a month; or a camel and stipulates
riding it to a specific place; or a slave and stipulates benefiting from his
services for a year."63
This was also the view of Al-Awzaa'ee, Ishaaq and Shibrimah. 64 An-
Nawawee said, "[This view] was also held by four of our companions
amongst jurists and hadeeth scholars, namely Abu Thawr, Muhammad
ibn Nasr, Abu Bakr Ibn Khuzaimah and Ibn Al-Mundhir; Ibn Al-
Mundhir also reported it from Ahl Al-Hadeeth65 . The same opinion has
60 Gharar: A deceptive or unclear practice. The Arabic root means deception. The term
covers a range of unacceptable business practices which range from fraud, to market
manipulation, to taking advantage of a consumer. For instance, any contractual
situation in which one party stands to be disadvantaged due to ignorance or
incomplete information is subject to gharar, and not acceptable in the Sharee'ah. Islamic
protections against gharar are very similar to Western consumer protection statutes.
[Translator's Note]
61 Judge 'Abdul-Wahhaab Al-Baghdaadee, Al-Furooq, p. 85; Al-Wanshareesee, 'Uddat Al-
Burooq, p. 418; Abul-Fadhl Ad-Dimashqee, Al-Furooq Al-Fiqhiyyah, p. 80.

62 Ash-Harh Al-Kabeer 'Alaa Al-Muqni'; 11/214; Al-Maawardee, Al-Insaaf, 11/214; Fath Al-
Baaree, 5/314; Al-Majmoo', 9/369.

63Al-Mughnee, 6/166
64 At-Tahhaawee, Mukhtasar Ikhtilaaf Al-Fuqahaa', 3/136; Fath Al-Baaree, 5/314; Al-
Qurtubee, Al-Mufham, 4/510; 'Aaridhat Al-Ahwadhee, 6/10; Ash-Sharh Al-Kabeer 'Alaa

Al-Muqni', 11/214.
65 The traditionist school of Ahl Al-Hadeeth (literally, 'People of Hadeeth') was a
continuation of the school of those Sahaabah (Prophet's companions) whose fear of
Al-Adl (35) 29
been reported to have been expressed by Othmaan [ibn 'Affaan] and

Suhaib [Ar-Roomee] (may Allah be pleased with them). 66
Commenting on the hadeeth reported on the authority of Jaabir,
Judge Ibn Al-'Arabee writes, "Al-Awzaa'ee, Ahmad and Ishaaq consider
such [a transaction] permissible, and it takes the form of a sale and a
lease." Then he says, "If it is a sale and a lease [combined], then there is
no contradiction whatsoever thereof."67
Imaam Ibn Taymiyyah also writes, "The seller may have a legitimate
reason for delaying the delivery [of the asset], just as happened to Jaabir
when he sold his camel to the Prophet (may Allah's peace and blessings
be upon him) and stipulated riding it to Madeenah. Therefore, it is
permissible for every contracting party to exclude the use of any
usufruct of the asset in which there is a legitimate reason [to do so], such
as selling real property and excludes living in it for some time, his riding
animals and excludes riding them, offering a dominion and excludes the
use of its usufruct, freeing a slave and excludes his services for a period
of time, or as long as he remains his master, or endowing an asset and
excludes the use of its proceeds for himself for the rest of his life, and the
like. This is also the view of Ahmad and other [jurists]." 68
Ibn Al-Qayyim also writes, "It is absolutely permissible if he sells
another person a house, a salve or a commodity and excludes using the
usufruct of the sold asset for a specific period of time, as have been
contradicting the letter of the source texts, nusus, made them circumspect to the point
where they never went any further than the texts. This was the case, by and large, with
‘Abd Allah ibn ‘Omar ibn al Khattaab, 'Abdullaah ibn 'Amr ibn al 'Aas, az-Zubayr and
'Abdullaah ibn 'Abbaas. The school of Ahl Al-Hadith became widespread in the Hejaz
for many reasons, of which perhaps the most important were the great number of
ahaadeeth (plural form of hadeeth) and other narrations known to the people of that
area, and the fact that the region was more stable after the seat of the Khilafah
(Caliphate) had been moved, and most of the political activity had been transferred,
first to Damascus, then to Baghdad. The Imam of Madeenah, Sa’eed ibn al Musayyib
(d. 94 AH), once noted that the people of Makkah and Madeenah had not lost much of
the ahaadeeth and fiqh, because they were familiar with the Fataawaa and reports of Abu
Bakr, Omar, Othmaan, 'Ali (before he became caliph), 'Aa'ishah, Ibn 'Abbaas, Ibn
Omar, Zayd ibn Thaabit and Abu Hurayrah, and thus did not need to use ra’i
(subjective opinion) in order to derive law. [Translator's Note]
66 Al-Majmoo', Sharh Al-Muhadh-dhab, 9/378.
67 'Aaridhat Al-Ahwadhee, 6/10.
68 Majmoo' Fataawaa Ibn Taymiyyah, 20/545.
30 Al-Adl (35)
established by texts [of the Qur'an and the Sunnah], jurists' statements,
public interest and sound analogical deduction."69
The Preponderant View

After much contemplation and deep thinking about these three
opinions, the evidence furnished by their proponents, it seems clear that
the view held by the Hanbalites has more in its favour, given their
cogent evidence and invulnerability to criticism. The view that it is
permissible to sell the leased asset is cogent because the use of its
usufruct is undoubtedly excluded. The Maalikites' difference is, in
essence, linguistic and their controversy is merely nominal, largely
dominated by juristic skill, which is clearly attributed to the difference in
opinion as to juristic assumptions relating to the interpretation of the
hadeeth narrated by Jaabir ibn Abdullaah (may Allah be pleased with
him) and to a real difference in the content or evidence. Allah knows
best.
Conclusion
After this detailed juristic study, which has clearly delineated the
jurists' opinions, their schools and the evidence they have furnished
regarding the issue under discussion, as well the discussion of their
respective views, the following concluding remarks can be made:
1. Leasing out the purchased asset to the person who has sold it
may take place expressly, in which case a person, for instance, sells his
house to another person and then takes it on lease from him for a
specific period of time. It may also take place implicitly, an example of
which is when a person sells an asset and excludes the use of its usufruct
for a specific period of time because the exclusion of using the usufruct
actually constitutes an equal counter-value for the exception. In other
words, it is an implicit lease of the asset from the person who has
purchased it. What happens in this case is that the excluded usufruct is
equivalent with part of the price, and thus the price of the asset with the
69 I'laam Al-Muwwaqi'een, 3/389.
Al-Adl (35) 31
exclusion is less than that without the exclusion. The difference in price
here represents the compensation for the excluded usufruct.
2. Explicitly leasing out the asset to the person who has sold it may
be operational or one that ends with ownership.
3. If the lease is operational, (1) it may take place without a prior
agreement preceding the conclusion of the contract or a condition laid
down in the contract, (2) the lease may be stipulated as a condition in the
sale contract or (3) the contracting parties may have agreed on it.
a. If the lease takes place without a prior agreement before the
conclusion of the contract or stipulation of a condition in the contract
itself, then, it is absolutely permissible, according to all Muslim jurists.
b. If the lease is stipulated in the sale contract, Muslim jurists are
not in agreement as to the legal validity of this transaction. The first
view; that of the majority of Muslim jurists, states that it is
impermissible, while the second view, that of the Maalikites and Ibn
Taymiyyah, hold that it is absolutely permissible. This is the
preponderant view in my opinion.
c. If there is some form of prior agreement before the conclusion of
the contract between the seller and the purchaser to give the asset on
lease to the person who has sold it, then this transaction is deemed
legally valid and binding according to the Maalikites and Ibn
Taymiyyah from amongst the Hanbalites, on the basis of the fact that the
prior agreement before the conclusion of the contract amounts to the
condition stipulated in the contract itself, according to the majority of
Muslim jurists, in terms of legal validity and the necessity of honouring
the terms and conditions of the contract even if such an agreement is not
explicitly expressed during the conclusion of the contract as long as the
contract depends on it and is concluded on its basis.
4. If the lease of the asset ends with ownership, it may take place
through an agreement prior to the conclusion of the contract or a
condition stipulated in the contract itself or without such an agreement
or condition.
a. If it takes place following an agreement before the conclusion of
the contract or a condition stipulated in the contract, and the lease
payment is far more than the price paid in advance at which he has sold
it to him, then such a transaction is legally invalid as it amounts to a
32 Al-Adl (35)
novel form of usury known as ''aks al-'eenah'70; for with the conclusion of
such a contract the seller intends to recover the ownership of the asset he
has sold from the person who has bought it from him (on the pretext of
the so-called complex contractual form described as ijaarah muntahiya
bittamleek "lease-to-own or capital lease") at a deferred price which is far
more than the price paid in advance at which he has sold it. This
prohibited practice is in fact used as a trick to effect a usurious loan.
b. If, however, the lease takes place without the stipulation of any
conditions in the contract or an agreement prior to the conclusion of the
contract, then the ruling regarding 'aks al-'eenah' (reversal of sell and buy
back agreement) applies to it if it is effected without any collusion or
deception. Permissibility of such a transaction remains a controversial
issue among Muslim jurists, but I believe it is absolutely permissible.
5. Leasing out the asset to the person who has sold it implicitly
takes place when a person sells another person his asset and excludes
the use of its usufruct for a specific period of time. Muslim jurists have
expressed three different opinions in this regard, nemly:
a. The Hanafites and the Shaafi'ites hold that this transaction is
prohibited altogether.
b. The Maalikites maintain that it is impermissible if it takes place
by way of exclusion and it becomes apparent that the use of the usufruct
is considerable; however, if it takes place by way of stipulating a
Al-Adl (35) 33
condition (i.e. a condition of lease in the sale contract), then it is

absolutely permissible.
The Hanbalites, Abu Thawr, Ibn Khuzaimah, Muhammad ibn Nasr,
Ibn Al-Mundhir from amongst the Shaafi'ites, Al-Awzaa'ee, Ishaaq , Ibn
Shibrimah and many others argue that it is absolutely permissible
without any restrictions whatsoever. This is the preponderant view in
my opinion. Allah knows best.
34 Al-Adl (35)

Leasing Out The Purchased Asset To The Person Who Sold It Expressly and Implicitly

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Leasing out the Purchased Asset

to the Person who Sold it

Dr. Nazeeh Kamaal Hammaad1

1 Dr. Nazeeh Kamaal Hammaad was formerly professor of Islamic Jurisprudence

I. Leasing an Asset to the Person who Sold it

a. The lease takes place without prior agreement or any conditions

6 See Ibn Taymiyyah, Nadhariyyat Al-'Aqdi, p. 227; Al-BA'lee, Al-Ikhtiyyaaraat Al-

grams. [Translator's Note]

mujtahidoon (erudite scholars who exercise ijtihaad, or independent reasoning;

19 Al-Wanshareesee, 'Uddat Al-Burooq, p. 418; Abul-Fadhl Ad-Dimashqee, Al-Furooq Al-

Linguistically, muwwaata'ah means 'agreement'22. In Faaris said,

I'laam Al-Muwwaqqi'een, 3/242.

honouring the terms of the contract, invalidity and cancellation,

permissible according to the Maalikites and Ibn Taymiyyah from among

II. Leasing out the Asset that ends with Ownership

(12/4), in its twelfth session held in Riyadh in the period 23-28

the asset is transferred to him through a separate gift contract following

31 Ibn Qayyim Al-Jawziyyah, Ighaathat Al-Lahfaan, 1/339.

something prohibited is itself prohibited. [Translator's Note]

Imaam Ibn Al-Qayyim writes in this connection, "It is well-known

36 Ighaathat Al-Lahfaan, 1/352.

Muntahaa Al-Iraadaat, 2/158; Al-Mughnee, 6/263; Kash-shaaf Al-Qinaa', 3/174; and

Mujtahid, 2/142; Kash-shaaf Al-Qinaa', 3/175; and Al-Insaaf, 11/195.

'Alaa Al-Miqni', 11/196.

jurisprudence, requires that the use of that which is permissible far

40Ash-Shaatibee writes in Al-Muwwafaqaat (4/198), "The principle of "blocking the

of it relate to the highly objectionable satanic whisperings. Therefore,

II. Leasing an Asset to the Person who Sold it

42 Ibn 'Aashoor, Maqaasid Ash-Sharee'ah Al-Islaamiyyah, p. 370.

inconsistent with the requirements of a contract and is an example of

45 Reportedby Ahmad, Al-Bazzaar and At-Tabaraanee on the authority of Ibn Mas'ood

Taymiyyah's Al-Fataawaa Al-Kubraa, 5/145.

transmitters is classified as 'authentic' (Saheeh), as Al-Haafidh mentioned in Al-Fath. See

51 Ibn Abul-'Izz Al-Hanafee, At-Tanbeeh 'Alaa Mushkilaat Al-Hidaayah, 4/384.

At-Tabaraanee, Al-Mu'jam Al-Awsat, 2/169; Muntakhab Kanz Al-'Ummaal, 2/29; Saheeh

57 Bidaayat Al-Mujtahid, 2/161; Al-Wanshareesee, 'Uddat Al-Burooq, p. 418; Abul-Fadhl

Burooq, p. 418; Abul-Fadhl Ad-Dimashqee, Al-Furooq Al-Fiqhiyyah, p. 80.

Baaree, 5/314; Al-Majmoo', 9/369.

Qurtubee, Al-Mufham, 4/510; 'Aaridhat Al-Ahwadhee, 6/10; Ash-Sharh Al-Kabeer 'Alaa

continuation of the school of those Sahaabah (Prophet's companions) whose fear of

been reported to have been expressed by Othmaan [ibn 'Affaan] and

The Preponderant View

69 I'laam Al-Muwwaqi'een, 3/389.

condition (i.e. a condition of lease in the sale contract), then it is

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