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Questions on Inheritance. 20 Sh’baan 1426 A.H. / 25 September 2005


Maulana: Assalaamu Alaikum.


  1. Aunty Amina passed away on 17/09/05. What happens at month-end to pay her maids wages, levy, water/lights etc. Can you pay from Aunty Amina’s money only upto 17/09/05 or can you pay for the full month?


  1. She has no children, no husband and no parents. She has only one sister and two step brothers and two step sisters (father is the same, mother is different), no contact with them. Do they inherit and what percentage if they do?

  2. Aunty Amina receives R1000.00 every three months from her mother’s inheritance. She has passed away but the money will continue coming. How must this be distributed every three months? It was her wish that her niece and nephew receive 1/3 of this amount every three months? Is this permissible?



  1. From her 1/3 of her estate she asked that a certain amount be given to her maid and the rest to her niece and nephew? Can any amount be given to the maid since she did no stipulate the amount?


  1. The flat she lived in, she and her sister shared the expenses. The furniture and dishes belonged to her which she gave to her sister in her lifetime. Is this permissible?


  1. She withdrew money from Al-Barakah and gave it to her sister. She asked her sister to give out Zakaat and Kaffarah and give money towards printing some kitaabs. This was not done before she passed away. Can you give the money from her estate before giving the heirs their share?


  1. She gave me R21000.00 which I had estimated would be the cost for a borehole and water well. The cost of it was R18000.00. Her sister told me to keep the R3000.00, until they tell me where to give it. Must this money go to the heirs or can it be given in charity.





The Answer In The Name of Allah, The Almighty.


  1. The deceased persons levy, her maid’s wages and her electricity bill are all a debt on the estate of the deceased. These expenses will be paid out from the estate of the deceased only until the 17-09-2005.


  1. If in reality these are the only heirs of the deceased, then they will inherit from the estate as follows;


Everything that the deceased owned at the time of her death, i.e. her clothes, property, jewelry, cash, receivables etc. all comprise of her estate. First of all the expenses of a moderate kafn and burial will be taken out from the estate. However, if someone has paid for these expenses from his/her side voluntarily then these expenses will not be subtracted from the estate. Thereafter, if the deceased had any debts, then these debts will be paid out from the remainder of the estate.

Thirdly, as mentioned in question no 4 the deceased had made a bequest. Hence, this bequest (wassiyat) will be paid out from one third of the remainder of the estate (see the answer to question no.4 for details of how to distribute this amount).

Thereafter, whatever remains will be distributed amongst the heirs as follows:

The entire estate will be divided into 12 equal portions from which 6 portions will be given to the deceased person’s real sister, two portions to each of her step brothers and one portion to each of her step sisters.


  1. One third of this R1000.00 can be given to her nephew and niece provided this amount is not more than one third of the entire estate after paying out debts if any. The remainder 2/3 will be distributed amongst the heirs as mentioned above.


  1. According to some quotations mentioned by the classical jurists, in a situation as mentioned in the question the one third of her estate should be distributed equally between the maid, the deceased persons nephew and her niece.


  1. It was permissible for the deceased to gift the furniture and dishes to her sister during her lifetime. As such, these items will now not form part of her estate. It should however be borne in mind that gifting during ones lifetime should not be done in order to deprive the other heirs of their share.


  1. This money should be returned to the estate as it is now the right of the heirs. If the heirs, however, wish to fulfill her Zakaat/Kaffaarah obligation voluntarily from their side they may do so and it is hoped from the mercy of Allah Ta’aala that the deceased would be absolved of her responsibility.


  1. This money should be returned to the estate and distributed amongst the heirs as mentioned above.



And Allah Knows Best

Shafiq Jakhura.

27 September 2005

By Justice Mufti Muhammad Taqi Usmani

Riba, Its Meaning And Application

Q. Respectable Mufti Saheb : Kindly forgive me for intruding on your precious time and specially during the Holy Month of Ramadan when you will be too busy. Also please forgive me in addressing this letter in English as perhaps I may not be able to express myself more clearly in Urdu.

You have been making research on various Islamic laws and principles which remain not clear in minds of people like me who have no knowledge or study of matters. As a learned scholars and having vast experience and knowledge of both Islamic Laws and practices of modern period, I hope to get a rely of my query from you. Matter is the same old one- what is the position of bank interest or profit - by whatever name it is called according to Shariah. To express whatever I understand I give below my feelings:-

1. Authentic definition of 'Riba' which has been declared by Allah and Holy Prophet (S.A.W) in Qur'an as "Haram"?

2. As far as I can see the charges of profit or interest one expects to get in return of his providing money to a needy person to fulfill his requirement of daily needs in the absence of any source to fulfill these is 'Riba' but any such return on money used for business, to earn more money, should not come under the definition of 'Riba'.


3. Generally it is said that if rate of profit is fixed it comes under definition of 'Riba' and becomes 'Haraam' but if it linked with profit earned, it is not 'Riba'. in my humble opinion this position is different. For example 'A' has got Rs. 100,000/= and he constructs a shop and gives it is fixed monthly rental for business. Or if he gives Rs. 100,000/= in cash for another business.What is the difference as far as 'A' is concerned. He is parting with his money, in one case he is giving it in kind and in another case in cash. Why return in both the cases be distinguished? Shop's rent is not dependent on profit or loss to the shopkeeper. If rent paid for shop is 'rental for shop why fixed return on cash is not rental of money'?

This letter is just to clarify the position and correct my thinking and in no way to convert Haraam into Halaal. After all after 15 Centuries, our concept should be clear at least on basic principles of our faith and we should not find excuses for justif- ication of our (mis) deeds.

I shell be greatful to have your considered opinion for my guidance at your earliest convenience.

A. I received your letter dated 27th January 1997 and apologize for the delay in replying it. It was due to my over whelming involvements both here and abroad. I hope you will forgive me for this delay. The questions you have posed have been discussed thoroughly in a number of books written on the subject both in Urdu and English. If you wish to benefit from Urdu writings I would advise you to read the following books:

"The Questions of Interest : Mufti Shafi (R.A.)" "Islam & Modern Business : Mufti Taqi Usmani" You may also benefit from the book or Dr. Anwar Iqbal Qureshi, titled "Islam and the theory of Interest". I think if you want to be very clear on this point you should at least study these books. However, I am giving here very brief answers to your questions:

1) The legal definition of any prohibited act is seldom given in the Holy Qur'an itself. For example, wine has been prohi- bited but no definition of wine has been given. Similarly, adultery, telling lies, back-biting and bribery have been prohibited by the Holy Qur'an but the definitions of these acts have not been provided. Reason for it is that all these concepts were too clear in the minds of the addresses to need any such definition. The same is the case of Riba. The concept of Riba was widely recognized among the addresses of the Holy Qur'an and it is that concept which is reflected in the legal definition provided for Riba either in the Hadithor in the later literature of Islamic jurisprudence. According to this definition any tra- nsaction of loan where the payment of an additional amount on the principal is made conditional to the advance of such loan is called Riba.

2) There is no distinction in Shariah between advancing a loan to a needy person or advancing it to a business concern. The principle is that the person who advances money to another person should clearly decide whether he wishes to assist him or he wants to share in his profits. In the former case, he should withdraw from any claim of additional amount (in the form of interest) while in the latter case he should share his loss also. It is not promitted by Shariah that he claims profit but does not agree to share his loss.

Another point which needs attention here is that the distinction between a needy and a rich person in commercial matters is totally irrelevant. If a shopkeeper sells a commodity to a poor person with a margin of profit which is not excessive no- body can say that it would be more advisable for the shop keeper to give him the commodity either as a charity or at cost without charging a profit but it cannot be said that the marginal profit charged here is not Halaal. If charging an additional amount on a loan is not in itself Haraam then the same analogy should have been applied here meaning thereby that if a creditor charges a marginal interest on the loan he has advanced to a poor person it should not be condemned or declared as Haraam, but even the modernists who hold the commercial interest as Halaal admit that this kind of transaction is Riba and prohibited by the Holy Qur'an. It proves that the basis of the prohibition is not linked to the poverty of the debtor. Had it been so, charging profit from a poor person would also have been declared as Haraam. Therefore, the only basis for the distinction between a sale and a transaction of Riba is that the former relates to commodity while the latter relates to money.

3) There are several differences between interest and rent. The basic principle of Shariah is that profit is justified where a person has undertaken the risk of the thing given to another person. In a transaction of loan, after advancing money, the creditor does not take any risk of the money because if the money is lost in the hands of the debtor after he has taken delivery thereof the debtor is lost in the hands of the debtor after he has taken delivery thereof the debtor is bound to repay the loan. As the creditor did not take any risk of it, therefore he cannot charge additional profit thereon. While in the case of the property leased out to the lease, the lessor has taken the risk of the property, if the property is destroyed, he will bear the loss, therefore, it is justified for him to charge rent from the lessee. Another difference is that the property is always subject to depreciation while money does not depreciate. Therefore, charging of rent in the first case is justifiable while it is not so in the later case.

I hope that these brief answers will at least explain the basic concepts. However, for greater details you should study the books I have referred to above.

[This article was published in the 10th issue of Nida'ul Islam magazine, November-December 1995]

For millions of Muslims, banks are institutions to be avoided. Islam is a religion which keeps Believers from the teller's window. Their Islamic beliefs prevent them from dealings that involve usury or interest (Riba). Yet Muslims need banking services as much as anyone and for many purposes: to finance new business ventures, to buy a house, to buy a car, to facilitate capital investment, to undertake trading activities, and to offer a safe place for savings. For Muslims are not averse to legitimate profit as Islam encourages people to use money in Islamically legitimate ventures, not just to keep their funds idle.

However, in this fast moving world, more than 1400 years after the Prophet (s.a.w.), can Muslims find room for the principles of their religion? The answer comes with the fact that a global network of Islamic banks, investment houses and other financial institutions has started to take shape based on the principles of Islamic finance laid down in the Qur'an and the Prophet's traditions 14 centuries ago. Islamic banking, based on the Qur'anic prohibition of charging interest, has moved from a theoretical concept to embrace more than 100 banks operating in 40 countries with multi-billion dollar deposits world-wide. Islamic banking is widely regarded as the fastest growing sector in the Middle Eastern financial services market. Exploding onto the financial scene barely thirty years ago, an estimated $US 70 billion worth of funds are now managed according to Shari'ah. Deposit assets held by Islamic banks were approximately $US5 billion in 1985 but grew over $60 billion in 1994.

The best known feature of Islamic banking is the prohibition on interest. The Qur'an forbids the charging of Riba on money lent. It is important to understand certain principles of Islam that underpin Islamic finance. The Shari'ah consists of the Qur'anic commands as laid down in the Holy Qur'an and the words and deeds of the Prophet Muhammad (s.a.w.). The Shari'ah disallows Riba and there is now a general consensus among Muslim economists that Riba is not restricted to usury but encompasses interest as well. The Qur'an is clear about the prohibition of Riba, which is sometimes defined as excessive interest. "O You who believe! Fear Allah and give up that remains of your demand for usury, if you are indeed believers." Muslim scholars have accepted the word Riba to mean any fixed or guaranteed interest payment on cash advances or on deposits. Several Qur'anic passages expressly admonish the faithful to shun interest.

The rules regarding Islamic finance are quite simple and can be summed up as follows:


a) Any predetermined payment over and above the actual amount of principal is prohibited.
Islam allows only one kind of loan and that is qard-el-hassan (literally good loan) whereby the lender does not charge any interest or additional amount over the money lent. Traditional Muslim jurists have construed this principle so strictly that, according to one commentator "this prohibition applies to any advantage or benefits that the lender might secure out of the qard (loan) such as riding the borrower's mule, eating at his table, or even taking advantage of the shade of his wall." The principle derived from the quotation emphasises that associated or indirect benefits are prohibited.

b) The lender must share in the profits or losses arising out of the enterprise for which the money was lent.
Islam encourages Muslims to invest their money and to become partners in order to share profits and risks in the business instead of becoming creditors. As defined in the Shari'ah, or Islamic law, Islamic finance is based on the belief that the provider of capital and the user of capital should equally share the risk of business ventures, whether those are industries, farms, service companies or simple trade deals. Translated into banking terms, the depositor, the bank and the borrower should all share the risks and the rewards of financing business ventures. This is unlike the interest-based commercial banking system, where all the pressure is on the borrower: he must pay back his loan, with the agreed interest, regardless of the success or failure of his venture.

The principle which thereby emerges is that Islam encourages investments in order that the community may benefit. However, it is not willing to allow a loophole to exist for those who do not wish to invest and take risks but rather content with hoarding money or depositing money in a bank in return for receiving an increase on these funds for no risk (other than the bank becoming insolvent). Accordingly, under Islam, either people invest with risk or suffer loss through devaluation by inflation by keeping their money idle. Islam encourages the notion of higher risks and higher returns and promotes it by leaving no other avenue available to investors. The objective is that high risk investments provide a stimulus to the economy and encourage entrepreneurs to maximise their efforts.

c) Making money from money is not Islamically acceptable.
Money is only a medium of exchange, a way of defining the value of a thing; it has no value in itself, and therefore should not be allowed to give rise to more money, via fixed interest payments, simply by being put in a bank or lent to someone else. The human effort, initiative, and risk involved in a productive venture are more important than the money used to finance it. Muslim jurists consider money as potential capital rather than capital, meaning that money becomes capital only when it is invested in business. Accordingly, money advanced to a business as a loan is regarded as a debt of the business and not capital and, as such, it is not entitled to any return (i.e. interest). Muslims are encouraged to purchase and are discouraged from keeping money idle so that, for instance, hoarding money is regarded as being unacceptable. In Islam, money represents purchasing power which is considered to be the only proper use of money. This purchasing power (money) cannot be used to make more purchasing power (money) without undergoing the intermediate step of it being used for the purchase of goods and services.

d) Gharar (Uncertainty, Risk or Speculation) is also prohibited.
Under this prohibition any transaction entered into should be free from uncertainty, risk and speculation. Contracting parties should have perfect knowledge of the counter values intended to be exchanged as a result of their transactions. Also, parties cannot predetermine a guaranteed profit. This is based on the principle of 'uncertain gains' which, on a strict interpretation, does not even allow an undertaking from the customer to repay the borrowed principal plus an amount to take into account inflation. The rationale behind the prohibition is the wish to protect the weak from exploitation. Therefore, options and futures are considered as un-Islamic and so are forward foreign exchange transactions because rates are determined by interest differentials.

A number of Islamic scholars disapprove the indexation of indebtedness to inflation and explain this prohibition within the framework of qard-el-hassan. According to those scholars, the creditor advances the loan to win the blessings of Allah and expects to obtain the reward from Allah alone. A number of transactions are treated as exceptions to the principle of gharar : sales with advanced payment (bai' bithaman ajil); contract to manufacture (Istisna); and hire contract (Ijara). However, there are legal requirements for the conclusion of these contracts to be organised in a way which minimises risk.

e) Investments should only support practices or products that are not forbidden -or even discouraged- by Islam. Trade in alcohol, for example would not be financed by an Islamic bank; a real-estate loan could not be made for the construction of a casino; and the bank could not lend money to other banks at interest.


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