Validity of Murabaha Contract Depends on Meeting Certain Conditions Stipulated in Sharia

Answered according to Shafi'i Fiqh by Darul Iftaa Jordan
  A trader has asked me to bring him goods from China since he doesn`t have the money to do so. He added me to a mortgage deed and I wrote him a post-dated cheque until we returned from that country. We have also agreed on a fixed percentage of profit. Accordingly, we went to China, he choose the goods, I paid for them and took responsibility of delivering them to Amman. Moreover, he gave me cheques that covered the whole amount I had given him, in addition to the profit. What is the ruling of Sharia on this transaction?


All perfect praise be to Allah the Lord of the Worlds. May His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.

Based on the form mentioned in the above question, it is clear that this transaction is a contract of Murabaha to the purchase orderer (MPO). In order to be valid from the perspective of Sharia, this contract must meet a number of conditions. Thus, it is conditioned that the goods are received from the first seller and taken possession of in compliance with the Hadith in which Ibn Abbas (Allah be pleased with them) reported Allah's Messenger (PBUH) as saying: "He who buys food-rain should not sell it until he has taken possession of it. Ibn Abbas (Allah be pleased with them) said: I regard everything like food (so far as this principle is concerned)." {Agreed upon}. Thus, once the goods are taken possession of, they become the liability of the Murabih (Financier)in case of damage. It is also conditioned that the price of the goods is paid to the first seller by the Murabih, not the client ordering the purchase, or from his money. 

It isn`t valid that the client ordering the purchase signs the sale contract until the Murabih takes constructive or actual possession of the goods from the first seller.

In conclusion, it is clear that the above transaction has met the conditions of the Murabaha to the purchase orderer and seems to be valid from the perspective of Sharia. And Allah the Almighty knows best.



This answer was collected from the official government Iftaa Department of Jordan.

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