Q: If a person invested some money in a retail business and then within a period of between 3 to 6 months insists on his investment being returned, can he still be regarded as a partner in the business a few years on?
Q: Zaid and John entered into a muzaara'ah partnership. Zaid will provide the land and seeds and John will do the planting, etc.
They have agreed that they both will have 50% ownership in the crop. They also agreed that John will then handle the sale of the crop, and they will then divide what is earned between them 50% each.
Is this partnership valid? Can John be made a wakeel to purchase seedlings as well? If the above partnership was incorrect, how should it be redone, as there are already seeds planted.
Please advise.
Q: I invested 1 million dollars with my friend who is running a chicken business. Normally, what happens is that I invest my money and we specify that 200,000 from the profits will be mine and the rest will be his. Is this permissible or is this interest? Please also explain the basic laws of a partnership in Islam.
Q: What is the ruling with regards to the share of a deceased who was in a partnership with his/her siblings, or anyone else for that matter?
1. Do the heirs of the deceased automatically become partners in the business?
2. Are the living partners under any obligation to make the heirs of the deceased, partners in the partnership?
3. Does the partnership seize on the demise of a partner? If so, what are the heirs entitled to, and how should the living partners ensure that the heirs receive their due?
Q:
Question 1:
My brother in law and I would like to venture in a business of exporting rice from India to South Africa. He will invest 15% and I will invest 85% of cash in this venture. He will also be fully in charge for procuring the rice from the mills and for the admin work in India. I will be responsible for the work in South Africa, dealing with the customers and any other work that's needed.
I would like to find out how should our profit be distributed? Based on the percentage invested or 50/50?
Question 2:
I have invested in my brother in laws aluminium business where he uses my cash and buys for COD and his supplier gives him a cash discount of 1 rupees per kg. This cash discount he gives it to me as my dividends of my investment.
1. Is this dividends permissible for me (cash discount received by him/his business)?
2. Should it not be that the cash discount be for the business and the profit that he makes by selling the aluminium (of my cash that he used to buy) be split according to a fixed percentage mutually agreed?
Q: I have a business question. Two people decided to open a business. One person invested the money and the other person is responsible for running the business and the profits are to be shared between them.
Does the invester receive a salary also every month according to the shariah?
Q: I have a few questions pertaining to the dissolvement of a partnership. Preamble relating to the questions:
In the year 2012 (July) I sold a 50% share of my business to my cousin. Alhamdulillah our partnership proved to be very beneficial to both of us. In the year 2020 (August) I requested a dissolvement of the partnership due to personal reasons. During the time of our partnership, we established 2 branches, JHB & DBN. At the time of dissolvement we agreed to the following:
1) I would take the Durban branch and he would take the JHB branch.
2) The Durban branch generates a lower turnover so we decided to split the areas that the JHB branch supplies.
3) JHB would keep the following provinces exclusive to itself i.e Mpumalanga, Gauteng, North West and Free State. Swaziland and Lesotho would also fall under the JHB client base.
4) The Durban branch would keep the KZN & EC provinces exclusive to itself.
5) Limpopo would be divided into the following category: All “Blue Chip” clients would remain under the JHB branch whilst all independent hardware stores would fall under my portfolio of clients.
6) Botswana as well as a certain single customer from the North West would also fall under my portfolio.
7) Our agreement on the areas and customers only pertain to products that were manufactured by us. For any additional products or new products, there is no restriction on either party. Each partner is free to trade in these new products with any client in any area.
8) The value of the business was restricted only to actual value i.e no goodwill figures or future earnings were added to the value. Stock was calculated at cost and equipment was calculated at an agreed percentage of depreciation. Alhamdulillah , the dissolvement has been very amicable thus far and we pray to Allah Ta'ala that we both maintain our respect and love for each other.
Question:
1) Whilst we have a gentleman’s agreement in place pertaining to the restraint of trade, is it allowed in Shari'ah law?
2) The restraint agreement only pertains to the life time of either partner. Is this permissible?
What happens if either partner decides to hand over the business to their children. Will this restraint still be allowed?
3) In the event that either partner sells his business/branch will the restraint still be allowed?
Q: There are 3 partners in a business (2 active and 1 silent). The one active partner wishes to exit the business. The share will be paid off through the business over a period of time, not any external funds.
Will it be permissible for the 2 remaining partners to mutually agree that the share of the exiting partner will be purchased only by the active partner or is it compulsory for both partners to purchase this share equally?
Q: Seven people own shares in an asset, and have different wishes regarding what should be done with the asset i.e some wish to sell the asset while others wish to keep the asset. What is the Shar'ee ruling on how this matter should be resolved?
Q: If I venture into a capital investment partnership in which I will give the capital and my partner does the work. It will be specific to animals, my funds but animals will be at his farm, eat of his land and drink his water... But yes, any extra major expenses above this will be born from the capital amount which I give. Will this type of partnership be permissible if profits are split percentage wise?