In the previous episodes, we have discussed some basic principle, guidelines and etiquette that are related to the financial transaction in Islam. In this episode, we will discuss the Hadeeth narrated on the authority of ‘Abdullaah ibn ‘Umar, may Allaah be pleased with them, that the Messenger of Allaah, peace and blessing be upon him, said: “Both the buyer and the seller have the option of cancelling or confirming the bargain, as long as they have not parted and are still together, or one of them gives, the other the option (of keeping or canceling the bargain). If one of them gives the other the option (of keeping or canceling the bargain) and they agreed upon something, then transaction becomes binding.” [Reported by Al-Bukhaari and Muslim].

There is another Hadeeth has the same meaning narrated on the authority of Hakeem ibn Hizaam, may Allaah be pleased with him, that the Messenger of Allaah, peace and blessing be upon him, said: “Both the buyer and the seller have the option of cancelling or confirming the bargain unless they separate [Or said], until they separate and if they speak the truth and mention the defects, then their bargain will be blessed, and if they tell lies and conceal the defects, they might gain some financial gain but they will deprive their sale of (Allaah's) blessings.”

Such two Hadeeths have many benefits and rulings, we will explain them in the following points:

Firstly, according to Sharee‘ah terminology, sale means exchanging between money and money for the purpose of owning it with the verbal formula or an actual one that can indicate it.

As for its ruling, it is permissible according to the Quran, Sunnah, consensus of Muslim scholars, and analogical deduction. Allaah The Almighty Says (what means): {…But Allaah has permitted trade and has forbidden interest…} [Quran 2: 275].

Transaction become binding by every formula of acceptance, be verbal or actual, that people use for transactions. That is because Allaah The Almighty does not want us to worship Him with certain wordings in this regard; rather, one can use any wording that indicates it and makes the transaction binding.

The basic principle of transactions and trading is that they are permissible and nothing of them can be made prohibited except with an evidence from Quran and authentic Sunnah. Such basic principle is of great importance that we all have to know.

If we contemplate the prohibited trade transactions, we will find that they are not prohibited except due to the injustice and corruption they cause to any of the two parties of the contact. Some Muslim scholars have laid down three guidelines for this:

Firstly, Riba along with its three types: Riba Al-Fadhl (i.e. to take more in exchange of one commodity in the event of barter of two similar commodities), Riba An-Nansee‘ah (i.e. to take a larger return of one thing while two identical things are bartered. But in this case the larger return is affected after a fixed period of time), and Riba Al-Qardh (i.e. interest on lent money).

Secondly, ignorance and uncertainty that include many other major things and several forms.

Thirdly, deception that includes several forms and types.

Secondly, Muslim jurists, may Allaah have mercy upon them, have stated seven conditions for the validity of transaction and if one conditions of them is missed, the transaction will be void and impermissible.

First: Mutual Consent: A trade transaction becomes invalid if either the seller or the buyer is unjustly forced to conclude it. Therefore, a transaction concluded through unjust compulsion is deemed invalid and void. It was narrated that the Prophet, peace and blessing be upon him, said: “Selling should be only by mutual consent.” [Reported by Ibn Hibban, Ibn Majah, and other compilers of Hadeeth]

It is substantiated by the saying of Allaah The Almighty: {...but only {in lawful] business by mutual consent.}  [Quran 4: 29].

Second: Being free, having reached puberty, being legally accountable, and being sane: A trade transaction becomes invalid if either of the seller or the buyer is a minor, a foolish or weak-minded person, or an insane person who has not taken his guardian's permission (to conclude the transaction). However, if the guardian gave him permission, then selling and buying will be valid, otherwise, it will not unless the sold item is something trivial.

Third: the sold commodity has to be absolutely lawful to use (while there is no need or necessity). As for whatever implies no benefit such as insects or what has a prohibited benefit, such as intoxicants, or has a lawful benefit such as the dog, it is not permissible to be bought or sold it.

Fourth: Being the owner (of the commodity or the money) or a representative of the owner. It was narrated that the Prophet, peace and blessing be upon him, said to Hakeem ibn Hizaam, may Allaah be pleased with him: “Do not sell what you do not have (or possess).” [Reported by Ibn Maajah and At-Tirmithi who deemed it a Saheeh (authentic) Hadeeth].

Fifth: The price and the commodity must be available, (when the trade transaction is concluded), for any unavailable commodity is considered nonexistent and is illegal to be sold. That is because it is not permissible to sell nonexistent item according to the consensus of Muslim scholars and this applies to whatever is like it. Also because being unable to deliver it implies ignorance and uncertainty and thus transaction becomes prohibited and impermissible.   

Sixth: The price and the commodity must be known to the seller and buyer, for hiding any is regarded as fraud which is prohibited in Islam.

Thereupon, knowing the sold commodity can be fulfilled by seeing all of the sold item if some of it does not indicate it or seeing some of what can indicate the remaining. Also, this includes all what is known by touch, smell or taste.

Seventh: The price must be known to the seller and buyer because it is one of the two prices and thus it is stipulated to be known for them such as the sold commodity.

Dear reader, such as the conditions of trade transactions and thus if one of such condition is not met such as there is no mutual consent, one of them disagrees or the buyer is not allowed to handle his matters such as the insane person, selling and buying is concluded on a prohibited commodity, the buyer does not own the commodity, or is not able to deliver it or it and the price are not known, transaction will be invalid and prohibited.

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