Investments and shares

Q: My father passed away one year back. He had made an investment in unit trust of India. Now he has nominated me for that investment. What shall I do?

Q: I am trading in Indian share market. When I purchase a share it comes into my demat account (SHARE HOLDING ACCOUNT) after 3 days. Whereas when I sell the share it goes off from my demat account after 1 day. I know that it is forbidden to sell which is not in your possession. I have few questions in my mind.

1) As per the Indian stock market system I can purchase and sell at any time. But as per many Muslim scholars we should sell only when it comes into our possession. So I sell the shares after 3 days only though if I suffer losses. If I see losses then can I sell the shares before 3 days?

2) When the share are in my possession after 3 days then sometimes I want to sell it first and the buy it later on the same day. Is it a short sell? I want to clarify the mechanism for this scenario. I have 20 shares of xyz company in my account. I have sold it at higher amount and bought it at lesser amount on the same day. That means it should be deducted from my demat account and then again should be added to my account. As explained in point 1 it should take 3+1 day to complete the cycle. But this does not happen technically. Technically the shares remain my demat account. My question is- Is it permissible to do so? Or If I want to rebuy the shares then should I but it next day so that it goes from my demat account and then again comes into my account?

Q: I am by profession a freelancer and also a teacher. In the current situation I have observed that giving education has emerged as an industry to earn hefty amounts. There are different cases that I have observed. Academies just know to snatch fee in different ways. I have aim to provide free quality education. But my problem is that I cant support all at a once. For that I have come across an asset management company. Where our individual investments are invested in various other company's stock, shares, debentures, debt securities. They disburse the payments in case they earn the profits. These companies have policy to stand equally responsible in terms of losses. As for profits are concerned we are not given a fixed percentage, instead proprtionate to profits. I am wandering whether to invest in such companies in order to support the poor students. I am bit confused that if these companies invest in such activities where they will generate interest income. Whether i can use these profits or income for the betterment of poor students. So that they may avail the opportunities in education. I want to provide them a platform where their dreams may come true.

Please guide me whether I can invest in such company and can utilise that amount just for the sake of spreading education. And give them relief from such academies, who are just cutting their pockets. Please help me in achieving my goal.

Q: We live in a non Muslim country. I have a business in which we take a plot, then develop the building and then sell. Usually it is a partnership deal. I do it with my partner who is a non Muslim. For e.g. he invests 50% of money. I invest 50%. The money he invests is of riba (interest). Since he is a non Muslim, his major part of earnings are giving money on interest to people. So he gets 50% of profit of our business, I get 50%. Since in the investment his 50% invested money is of riba, will it be permissible for me to work with him or not? 

Q: I want to invest in an Islamic investment fund. Its a bank in Pakistan. They have fatwas from a senior mufti but I still have doubts if its haram or halal. Please guide.

Q: A person has an investment in a unit trust from the 1970's. The unit trust was not shariah compliant, and thus included investments in alcohol/gambling based companies, interest based financial institutions, as well as ordinary companies.

1. Is it permissible to utilise dividends received from the unit trust to pay income tax for a business?

2. Is it permissible to offset these dividends received from the unit trust against income tax that is deducted from a persons salary by his employer? If this is permissible, can it be offset against amounts deducted for income tax in previous years (as the dividends were already received then, and tax deducted then), or would it only be permissible going forward (as dividends are received and income tax deducted)?

Q: I have been investing in shares for the past two years and I have earned a good amount of profit so far. When investing, I avoid buying shares in companies such as banks, insurance companies, companies manufacturing and selling liquor, etc. I only invest in companies of which the main business is halaal. However, when I look at the financial statements of the companies, I find that these companies do have interest dealings and some other haraam elements in their operation. Will it be permissible for me to invest in these companies? Also, will the profits earned through the investment be halaal?

Q: I have been investing in shares since the past two years and i've earned good amounts of profit so far. I have been investing keeping in mind these points most contemporary scholars including Mufti Taqi Usmani have agreed upon which are:

1) The main business of the company must be lawful (halal). Therefore, to purchase shares of a company whose main business is unlawful, such as interest bearing banks, insurance companies, companies manufacturing and selling liquor, etc would not be permitted.

2) Many companies, despite their main business being Halal may be involved in interest dealings in one way or another. Due to this, the following is necessary:

a) One should object to the interest dealings, preferably in the annual AGM. By doing so, the responsibility will be deemed fulfilled.

b) When the dividend is distributed, the proportion of the company’s income which was gained by interest dealings must be given in charity without the intention of receiving reward, as is the case with unlawful money in general. This amount (of interest accumulation) may be known by means of the income statement.

3) The company, whose shares one intends to purchase, must have some illiquid assets in its possession. They must not all be in liquid form (i.e. cash, cheques, bonds, etc…). If all of the company’s assets are in liquid form, then the share cannot be sold or purchased except at face value.

One point among these which I haven't paid much heed to or couldn't pay heed to is:

a) One should object to the interest dealings, preferably in the annual AGM. By doing so, the responsibility will be deemed fulfilled.

This is because I live in Saudi Arabia and trade shares online in the Indian Stock Markets, which means the companies i invest in are based in India while
I am a resident of Saudi and visit India for only a month or two annually. I usually sell a company's shares within a period of 5 months. When I am in India, I won't necessarily get to attend an AGM of the companies I am invested in during that period. Even if I might, they might be in different cities.

So far, I have sold stocks of around 7 companies making a profit in 6 of them and a loss in one of them. Currently, I am invested in just one company's shares.

Will my responsibility be deemed fulfilled if I send an email to the 7 companies whose shares I've already sold off objecting their dealings in interest? Or should I give away ally my profits earned through the sale of these 6 among 7 company's shares I've already sold in charity without expecting a reward in return.

Also, how am I to deal with the current company I'm invested in, in regard to objecting their interest dealings provided the fact that I might not be able to attend their AGM?

Q: I have a question on putting investment.

We have a group of around 45 people and each guy is putting a total of 1200 AED for 1.5 years. And one guy among us is buying a Limo Taxi to run as per Government Rules and every month he will be giving us 15% of the money after his expenditures like room, food, etc.

Total 55000AED only will be from our group of people, and remaining cash needed-the guy who is purchasing the car will be arranging. As per him, he will be paying back monthly to Emirates Transport, a Government Authority, the cash he will arrange. We asked any interest in that, he said he is not sure about it.

We will be getting 15% from the 55000AED amount we are investing, and this is fixed percentage, and the amount may increase or decrease based on how much work he will get with his taxi. But the percentage will be same 15%.

I would like to ask you, if in the amount we are investing there is no interest, will it be haram for us? Because, in the amount this guy is arranging, he may be paying monthly to Authority with interest.

Q:  Can we save money in margadarshi like monthly deposit. Is it permissible?