Can the whole amount refunded by IT Department after 7 months with interest be mine? Would I need to take out interest and give it to someone without intention of any reward?
What about the difference amount between the actual tax deducted and refunded which are 88,000 and 84,000 respectively?
Answer
(Fatwa: 153/124/N=1434)
According to Shariah income tax is unlawful and draconian. Hence in the question mentioned above whatever interest you receive from income tax department as interest it shall be lawful for you. It shall also be declared the part of deducted amount like 84000 in income tax though the department terms it as interest. However, if this amount is more than 4 thousand i.e. all the amount which you received back is more than 88 thousand along with interest, then the extra amount shall be interest as per the Shariah. It shall not be lawful to use it as fee of filling return or in any other way rather it shall be necessary to give it in charity to the poor and needy ones without the intention of reward.
Allah (Subhana Wa Ta’ala) knows Best
Darul Ifta,
Darul Uloom Deoband