Q: I have a question regarding an investment I made. I invested an amount with an owner of a clothing shop and it was pre agreed that I would receive a set amount of the profits on a monthly basis which I did for a few months. Recently the shop has been doing bad and the owner decided to sell it. Initially we verbally agreed that if for some reason the shop closed he would return the amount I originally invested to me. I am still waiting for my funds as we had not set a time frame. I would like to know if such an investment was permissible and whether the money I originally invested is still halaal for me to use (when I receive it)? I am asking as I am planning to use the money for Hajj insha-Allah one day and don’t want to be in doubt.
A: It is not permissible in a partnership to stipulate the profits in proportion to the capital investment e.g. one partner says I am investing hundred thousand rand on condition that I receive 10% of my capital every month (ten thousand rand). Furthermore, to place a condition at the beginning that one will have to receive his capital amount at the end of the partnership is also an invalid condition in Shari’ah. In Shari’ah the investor i.e. the partner has to share in the profit as well the loss.
And Allah Ta’ala (الله تعالى) knows best.
(و لا يجوز الشركة إذا شرط لأحدهما دراهم مسماة من الربح) لأنه شرط يوجب انقطاع الشركة فعساه لا يخرج الا قدر المسمى لأحدهما (هداية 2/632)