Home » Hanafi Fiqh » ShariahBoard.org » Using Mosque’s Land for Investors’ Personal Gains

Using Mosque’s Land for Investors’ Personal Gains

Answered as per Hanafi Fiqh by ShariahBoard.org

Assalamualaikum Mufti Sahib

We did fundraising in our area by telling the donors that we will buy approximately 11 acres land for building a mosque and Islamic school for the Muslim community and also created a nonprofit 501c3 organization with the State. We built the mosque and Islamic school with yearly fundraising for more than 20 years and continue to operate them through fundraising and revenue from the Islamic school (which is running as for profit). We can also do this endowment project by fundraising and taking loans if needed.

Now in our mosque Islamic center is run by a Board of Trustees (BOT) which is elected by members of the committee to ensure everything is run protecting Islamic law and safeguarding the Muslims community’s wellbeing. They are mentioning to the community that a 501c3 organization cannot have for profit projects, which is incorrect, as IRS mentions that the nonprofit organizations can have for profit projects, but they have to complete form 990 at the yearend to claim profit taxes if any. 

Recently, the BOT has been trying to approve a for profit LLC lease over one third of the mosque’s land, to build 9 duplex structures, initially for rental investment. The cost of the project is around 2.2 million, which has to be paid in 20 years, all profits will be distributed to the 30+ investors after expenses but only would give mosque approximately only $12,500 yearly for 20 years. Then the structures will become an endowment for the mosque. They have shown the lease drafts when asked.

It states that the LLC’s financials would be private to their LLC members and will not be disclosed to even the members. They are mentioning that they are doing this for the mosque’s endowment but in turn it will be bringing a huge return on investment for the 30+ investors.

Please provide us a Shar‘ai ruling in the following matters:

1) Can a BOT of our mosque they assign this land’s lease without getting approval from general members? Since they would personally invest and get benefited many fold in 20 years? Will this be allowed in Islam because we have heard that the land of the mosque is considered waqf and should only be used for the benefits of the mosque?

2) Will the personal gains received by the 30+ members based on the above details be considered permissible? Also, is it OK that they are not disclosing the LLC’s financials? Is it Islamically correct to keep secrecy from the mosque’s members and using the waqf, when financials are needed for performing income and expenses balances correctly.

JazakAllahu Khaira

Using Mosque's Land for Investors' Personal Gains

Walaikumassalam Warahmatullahi Wabarakatuhu

الجواب و باللہ التوفیق

1- In order to benefit the mosque and support is financial needs, if construction on the land belonging to the mosque is deemed required, then there is gunjaish (provision for permissibility) in performing such construction and taking loan for it.

2- If the loan is acquired and the said construction is performed, the newly constructed structure(s) will remain as the mosque’s property and no one else’s. However, the people who have given the loan shall have their moneys returned to them only in the amount of the loan and nothing extra should be given back to them. Such repayment can be performed in any suitable agreed upon manner or method such as through the rent from the houses or any other source. But it should be noted that generating any personal gain from this process or making extra money on the loan which was given is considered an interest based transaction from a Shar‘ai standpoint, and apparently there is an indication of that in the said situation. Therefore, if there is any possibility like that, then it is mandatory to refrain from it.

3- When the school was designed, it was done under the notion of a nonprofit organization and the donation was collected under that same intention as well, therefore, if any aspect of the school is being used for one’s personal gain, then that will also be considered impermissible.

4- Since both the issue of the mosque and the school are related to waqf, which is also related to loan for the mosque and the rights of the general public, and then there are committee members who cooperate in these operations who have been chosen so that such consultation can be done and their help can be utilized, then in that situation it is not suitable to hide the details of this whole operation, especially when there have been indications of dishonesty.

5- The matter of utilizing people’s inheritance money for such construction etc. is also something which needs clarification because the estate of a deceased should be distributed among the heirs or at least such moneys should be utilized with the approval of the heirs. Otherwise, the deceased had to have mentioned the details of the bequeathed in their will. If the deceased had left a clause in the will to donate to the mosque, then only a maximum of one third of their estate can be taken for this purpose. Therefore, further details should be provided in this matter to get a more tailored response.

لایجوز الاستدانۃ علی الوقف إلا إذا احتیج إلیہا لمصحلۃ الوقف کتعمیر الخ وفی الشامیۃ ہو المختار أنہ إذا لم یکن من الاستدانۃ بدٌّ یجوز بأمر القاضی إن لم یکن بعیداً عنہ الخ۔

(الموسوعۃ الفقہیۃ الکویتیۃ ۴۴/۱۹۳)

ویجوز للمتولی إذا احتاج إلیٰ العمارۃ أن یستدین علی الوقف ویصرف ذلک فیہا والأولیٰ أن یکون بإذن الحاکم الخ۔

(البحرالرائق، کوئٹہ ۵/۲۱۱، زکریا۵/۳۵۳)

والاستدانۃ أما إذا کان للوقف غلۃ فأنفق من مال نفسہ لإصلاح الوقف فإن لہ أن یرجع بذلک فی غلۃ الوقف۔

(البحرالرائق، ۵/۳۱۱)

أما لو تمت المسجدیۃ ثم أراد البناء منع (الدر المختار) وأما لو تمت المسجدیۃ ثم أراد ہدم ذٰلک البناء؛ فإنہ لا یمکن من ذٰلک۔

(الدر المختار مع الشامي، کتاب الوقف / مطلب في أحکام المسجد، ۶؍۵۴۸ زکریا)

شرط الواقف کنص الشارع أي في وجوب العمل بہ، وفي المفہوم والدلالۃ۔

( کذا في الدر المختار، کتاب الوقف / مطلب استأجر دارًا فیہا أشجار، ۶؍۶۴۹ زکریا)

علی أنہم صرحوا بأن مراعاۃ غرض الواقفین واجبۃ۔

(شامي، کتاب الوقف / مطلب: مراعاۃ غرض الواقفین واجبۃ والعرف یصلح مخصصًا ۶؍۶۶۵ زکریا)

فقط واللہ اعلم بالصواب


This answer was collected from Shariahboard.org. It was established under the supervision of the eminent faqih of our era, Hazrat Shah Mufti Mohammed Navalur Rahman damat barakatuhum.

Read answers with similar topics: