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Is it Permissible to Classify Excess Value in Business Sales as ‘Goodwill’ in Shariah?

Answered as per Hanafi Fiqh by Muftionline.co.za

Q: A person questions that the excess value over the net assets in a sale of business if classified correctly as “goodwill” then it will not be permissible in the shariah, however if you attribute the same excess to the “‘shop fittings” figure for example it will now become permissible. He questions that the purchaser, seller and the receiver are fully aware that this inflated figure is not a true reflection of the shop fittings figure so how does one hope to dupe Allah (Ta’ala) by such a practise to make it shariah compliant?


A: When this is taken in lieu of the shop fittings then the seller has the right to sell his equipment at the price he wishes. This has not been taken into consideration. The shari`ah has overlooked this. There are many example for this practice. For example, you will buy a bottle of cool-drink in a normal shop for 10 rands and if the same was sold to you in a restaurant they may charge you 30 rands.

And Allah Ta’ala (الله تعالى) knows best.


Answered by:

Mufti Ebrahim Salejee (Isipingo Beach)

This answer was collected from MuftiOnline.co.za, where the questions have been answered by Mufti Zakaria Makada (Hafizahullah), who is currently a senior lecturer in the science of Hadith and Fiqh at Madrasah Ta’leemuddeen, Isipingo Beach, South Africa.

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