- Published on
Islamic Law of Transaction - Ease, Honesty, and Ethics in Sales
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. Therefore, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics and Good Conduct in Sales
Islam places great importance on honesty, fairness, mercy, and ease in business transactions.
One important ethical principle is avoiding excessive profit and unfair advantage over buyers. Islam allows traders to make reasonable profit, but it discourages exploitation and cheating. The Maliki School scholars explained that excessive unfairness may exist when profit reaches one third or more above the normal value. Therefore, profit within reasonable limits is generally acceptable.
Another important principle is truthful and complete disclosure of information. A seller must provide honest and complete details about the product, including its type, origin, quality, condition, and cost. Hiding defects, giving false information, or misleading customers goes against Islamic business ethics.
Al-Tirmidhi narrated a Ḥadīth on the authority of Rifāʿah in which the Prophet ﷺ said that most merchants will be resurrected on the Day of Judgment as sinners except those who fear Allah, deal kindly with customers, and speak truthfully in their business transactions.
Islam also encourages ease and kindness in buying and selling. Sellers and buyers should not be too harsh in negotiations or place unreasonable conditions on one another. They should avoid demanding prices that are unfairly high or unrealistically low.
Al-Bukhari narrated on the authority of Jābir that the Prophet ﷺ said: “Allah shows mercy to a person who is easy and gentle when selling, buying, and collecting debts.” This Ḥadīth teaches Muslims to act with patience, kindness, and flexibility in financial dealings.
These ethical principles help create fairness, trust, and good relationships in society and prevent harm or exploitation in business transactions.
Case Scenario: Fair, Honest, and Easy Dealings in Trade
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. Ahmad honestly informs Bilal that the bicycle has a small scratch and that one brake needs repair. After payment, Bilal takes possession of the bicycle. This is a valid and ethical sale because there is lawful ownership, mutual consent, truthful disclosure, fair dealing, and transfer of ownership.
During the negotiation, Bilal asks Ahmad for a small discount because he is a student. Ahmad agrees to reduce the price slightly to make the transaction easier for both parties. This reflects the Islamic teaching of kindness and ease in business dealings.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
However, if Ahmad hides major defects in the bicycle, falsely claims that it is new, or demands an extremely unreasonable price to exploit the buyer, he would be violating Islamic business ethics. Likewise, forcing someone into a transaction, dealing harshly, or refusing reasonable discussions would go against the Islamic principle of ease and mercy in trade.
Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. Therefore, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics and Good Conduct in Sales
Islam places great importance on honesty, fairness, mercy, and ease in business transactions.
One important ethical principle is avoiding excessive profit and unfair advantage over buyers. Islam allows traders to make reasonable profit, but it discourages exploitation and cheating. The Maliki School scholars explained that excessive unfairness may exist when profit reaches one third or more above the normal value. Therefore, profit within reasonable limits is generally acceptable.
Another important principle is truthful and complete disclosure of information. A seller must provide honest and complete details about the product, including its type, origin, quality, condition, and cost. Hiding defects, giving false information, or misleading customers goes against Islamic business ethics.
Al-Tirmidhi narrated a Ḥadīth on the authority of Rifāʿah in which the Prophet ﷺ said that most merchants will be resurrected on the Day of Judgment as sinners except those who fear Allah, deal kindly with customers, and speak truthfully in their business transactions.
Islam also encourages ease and kindness in buying and selling. Sellers and buyers should not be too harsh in negotiations or place unreasonable conditions on one another. They should avoid demanding prices that are unfairly high or unrealistically low.
Al-Bukhari narrated on the authority of Jābir that the Prophet ﷺ said: “Allah shows mercy to a person who is easy and gentle when selling, buying, and collecting debts.” This Ḥadīth teaches Muslims to act with patience, kindness, and flexibility in financial dealings.
These ethical principles help create fairness, trust, and good relationships in society and prevent harm or exploitation in business transactions.
Case Scenario: Fair, Honest, and Easy Dealings in Trade
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. Ahmad honestly informs Bilal that the bicycle has a small scratch and that one brake needs repair. After payment, Bilal takes possession of the bicycle. This is a valid and ethical sale because there is lawful ownership, mutual consent, truthful disclosure, fair dealing, and transfer of ownership.
During the negotiation, Bilal asks Ahmad for a small discount because he is a student. Ahmad agrees to reduce the price slightly to make the transaction easier for both parties. This reflects the Islamic teaching of kindness and ease in business dealings.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
However, if Ahmad hides major defects in the bicycle, falsely claims that it is new, or demands an extremely unreasonable price to exploit the buyer, he would be violating Islamic business ethics. Likewise, forcing someone into a transaction, dealing harshly, or refusing reasonable discussions would go against the Islamic principle of ease and mercy in trade.
Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
- Published on
Islamic Law of Transaction - Issues of Truthfulness, Fairness, and Ethics in Sales
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics and Issues in Sales
Islam places great importance on honesty, fairness, and transparency in business transactions.
One important ethical principle is avoiding excessive profit and unfair advantage over buyers. Islam allows traders to make reasonable profit, but it discourages exploitation and cheating. The Maliki School scholars explained that excessive unfairness may exist when profit reaches one third or more above the normal value. Therefore, profit within reasonable limits is generally acceptable.
Another important principle is truthful and complete disclosure of information. A seller must provide honest and complete details about the product, including its type, origin, quality, condition, and cost. Hiding defects, giving false information, or misleading customers goes against Islamic business ethics.
Al-Tirmidhi narrated a Ḥadīth on the authority of Rifāʿah in which the Prophet ﷺ said that most merchants will be resurrected on the Day of Judgment as sinners except those who fear Allah, deal kindly with customers, and speak truthfully in their business transactions.
This shows that Islam strongly encourages honesty and good treatment of customers in all forms of trade.
Case Scenario: Honest and Dishonest Trade
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. Ahmad honestly informs Bilal that the bicycle has a small scratch and that one brake needs repair. After payment, Bilal takes possession of the bicycle. This is a valid and ethical sale because there is lawful ownership, mutual consent, truthful disclosure, fair dealing, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
However, if Ahmad hides major defects in the bicycle or falsely claims that it is new, he would be deceiving the buyer, which is against Islamic teachings. Likewise, charging extremely excessive prices to take unfair advantage of customers would also violate Islamic business ethics.
Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics and Issues in Sales
Islam places great importance on honesty, fairness, and transparency in business transactions.
One important ethical principle is avoiding excessive profit and unfair advantage over buyers. Islam allows traders to make reasonable profit, but it discourages exploitation and cheating. The Maliki School scholars explained that excessive unfairness may exist when profit reaches one third or more above the normal value. Therefore, profit within reasonable limits is generally acceptable.
Another important principle is truthful and complete disclosure of information. A seller must provide honest and complete details about the product, including its type, origin, quality, condition, and cost. Hiding defects, giving false information, or misleading customers goes against Islamic business ethics.
Al-Tirmidhi narrated a Ḥadīth on the authority of Rifāʿah in which the Prophet ﷺ said that most merchants will be resurrected on the Day of Judgment as sinners except those who fear Allah, deal kindly with customers, and speak truthfully in their business transactions.
This shows that Islam strongly encourages honesty and good treatment of customers in all forms of trade.
Case Scenario: Honest and Dishonest Trade
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. Ahmad honestly informs Bilal that the bicycle has a small scratch and that one brake needs repair. After payment, Bilal takes possession of the bicycle. This is a valid and ethical sale because there is lawful ownership, mutual consent, truthful disclosure, fair dealing, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
However, if Ahmad hides major defects in the bicycle or falsely claims that it is new, he would be deceiving the buyer, which is against Islamic teachings. Likewise, charging extremely excessive prices to take unfair advantage of customers would also violate Islamic business ethics.
Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
- Published on
Islamic Law of Transaction - Legitimacy, Definitions, and Ethics of Sale in Islam
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics of Sales
Islam places great importance on ethics and fairness in trade. One important ethical principle is avoiding excessive profit and unfair advantage over buyers. All religions discourage taking advantage of people through cheating or unreasonable pricing.
Islam allows traders to make a reasonable profit because trade cannot continue without profit. However, if one party gains an excessive advantage over the other, the sale may become unfair and could even be considered invalid.
The Maliki School scholars explained that excessive unfairness exists when the profit reaches one third or more above the normal value. Therefore, a profit that is less than or equal to one third is generally considered acceptable.
This principle encourages balance in business transactions so that sellers can earn profit fairly without exploiting buyers.
Case Scenario: Ethical and Unethical Sales
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. Ahmad also honestly informs Bilal that the bicycle has a small scratch. This is a valid and ethical sale because there is lawful ownership, mutual consent, honesty, fair dealing, offer and acceptance, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit to people.
However, if Ahmad buys a laptop for RM1,000 and knowingly sells it to an inexperienced buyer for RM3,000 without justification, this may be considered excessive profiteering and unfair dealing. Islam discourages such behaviour because it exploits the buyer unfairly.
Likewise, if Ahmad forces Bilal to buy the bicycle, cheats him, or hides serious defects in the item, the transaction would go against the Islamic principles of mutual consent and honesty. Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Islamic Ethics of Sales
Islam places great importance on ethics and fairness in trade. One important ethical principle is avoiding excessive profit and unfair advantage over buyers. All religions discourage taking advantage of people through cheating or unreasonable pricing.
Islam allows traders to make a reasonable profit because trade cannot continue without profit. However, if one party gains an excessive advantage over the other, the sale may become unfair and could even be considered invalid.
The Maliki School scholars explained that excessive unfairness exists when the profit reaches one third or more above the normal value. Therefore, a profit that is less than or equal to one third is generally considered acceptable.
This principle encourages balance in business transactions so that sellers can earn profit fairly without exploiting buyers.
Case Scenario: Ethical and Unethical Sales
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. Ahmad also honestly informs Bilal that the bicycle has a small scratch. This is a valid and ethical sale because there is lawful ownership, mutual consent, honesty, fair dealing, offer and acceptance, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit to people.
However, if Ahmad buys a laptop for RM1,000 and knowingly sells it to an inexperienced buyer for RM3,000 without justification, this may be considered excessive profiteering and unfair dealing. Islam discourages such behaviour because it exploits the buyer unfairly.
Likewise, if Ahmad forces Bilal to buy the bicycle, cheats him, or hides serious defects in the item, the transaction would go against the Islamic principles of mutual consent and honesty. Similarly, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
- Published on
Islamic Law of Transaction - Legitimacy, Definitions, and General Rules of Sale in Islam
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Permissible and Impermissible Sales in Islam
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. Ahmad also honestly informs Bilal that the bicycle has a small scratch. This is a valid and permissible sale because there is lawful ownership, mutual consent, honesty, benefit, offer and acceptance, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit to people.
However, if Ahmad forces Bilal to buy the bicycle, cheats him, or hides serious defects in the item, the transaction would go against the Islamic principles of mutual consent and honesty. Likewise, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
There is also agreement (ijmāʿ) among Muslims that sales are permissible. Islamic scholars agree that trade is necessary because it helps people fulfil their needs by cooperating and exchanging goods and services with one another. For this reason, the general rule in Islamic law is that all sales are permissible unless there is clear evidence that a specific type of sale is forbidden.
Al-Shafi‘i explained that the basic rule for all sales is permissibility as long as the transaction is carried out by capable people who willingly consent to it. However, any type of sale specifically prohibited by Prophet Muhammad ﷺ, or anything very similar to a prohibited transaction, is not allowed. Anything outside those prohibited matters remains lawful based on the Qur’anic verses that permit trade and commercial dealings.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Permissible and Impermissible Sales in Islam
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. Ahmad also honestly informs Bilal that the bicycle has a small scratch. This is a valid and permissible sale because there is lawful ownership, mutual consent, honesty, benefit, offer and acceptance, and transfer of ownership.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit to people.
However, if Ahmad forces Bilal to buy the bicycle, cheats him, or hides serious defects in the item, the transaction would go against the Islamic principles of mutual consent and honesty. Likewise, exchanging one identical RM10 note for another without any added benefit, or selling prohibited and worthless items such as dead animals or dust, would not be regarded as valid sales in Islamic law.
- Published on
Islamic Law of Transaction - Legitimacy, Meaning, and Ethical Principles of Sale in Islam
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Honest and Valid Trade in Islam
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, mutual consent, benefit, offer and acceptance, and transfer of ownership.
Ahmad also honestly informs Bilal that the bicycle has a small scratch on its side. By being truthful and not hiding defects, Ahmad follows the Islamic teaching of honest trade. Such a seller is praised in Islam as a trustworthy trader.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad forces Bilal to buy the bicycle, or hides serious defects in the item, the transaction would go against the Islamic principle that sales must be based on mutual consent and honesty. Likewise, selling worthless or prohibited items, such as dead animals or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “Take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “Let there be trade among you by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], meaning that earning through lawful trade and business is permissible.
The Sunnah of Prophet Muhammad ﷺ also supports lawful trade. The Prophet ﷺ was once asked which type of income is the best. He replied that the best income comes from a person’s own work and from every lawful and honest sale, meaning a transaction free from cheating and betrayal.
In another Ḥadīth, the Prophet ﷺ said: “A sale must be by mutual consent.” This shows that both the buyer and seller must willingly agree to the transaction without force or deception.
The Prophet ﷺ also accepted trade as a normal and lawful activity among people during his time. He praised honest business people by saying that a truthful and trustworthy trader will be among the prophets, the righteous, and the martyrs in the Hereafter. This Ḥadīth was narrated by Al-Tirmidhi and classified as ḥasan (good).
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Honest and Valid Trade in Islam
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal willingly accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, mutual consent, benefit, offer and acceptance, and transfer of ownership.
Ahmad also honestly informs Bilal that the bicycle has a small scratch on its side. By being truthful and not hiding defects, Ahmad follows the Islamic teaching of honest trade. Such a seller is praised in Islam as a trustworthy trader.
In another example, Sarah pays a tutor for online teaching services. Although Hanafi jurists may not classify services as physical commodities, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad forces Bilal to buy the bicycle, or hides serious defects in the item, the transaction would go against the Islamic principle that sales must be based on mutual consent and honesty. Likewise, selling worthless or prohibited items, such as dead animals or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
- Published on
Islamic Law of Transaction - Legitimacy, Meaning, and Conditions of Sale in Islam
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “But take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “But let there be among you trade by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], which means that earning through lawful trade and business is permissible.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Valid and Invalid Sales in Islamic Law
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, benefit, mutual consent, offer and acceptance, transfer of ownership, and delivery of the item.
In another example, Sarah pays a tutor for online teaching services. According to the Hanafi jurists, services may not be treated as commodities because they are not physical objects that can be stored. However, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
Sales and trade are lawful and permitted in Islam. Their legitimacy is supported by the Qur’an, the Sunnah (teachings and traditions of Prophet Muhammad ﷺ), and the consensus (ijmāʿ) of Islamic jurists.
The Qur’an clearly allows trade and commercial transactions. Allah says: “But Allah has permitted trade” [2:275]. The Qur’an also encourages proper commercial dealings by stating: “But take witnesses whenever you make a commercial contract” [2:282]. Another verse says: “But let there be among you trade by mutual consent” [4:29]. Allah also says: “It is no crime for you to seek the bounty of your Lord” [2:198], which means that earning through lawful trade and business is permissible.
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Valid and Invalid Sales in Islamic Law
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, benefit, mutual consent, offer and acceptance, transfer of ownership, and delivery of the item.
In another example, Sarah pays a tutor for online teaching services. According to the Hanafi jurists, services may not be treated as commodities because they are not physical objects that can be stored. However, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
- Published on
Islamic Law of Transaction - Meaning, Conditions, and Scholarly Definitions of Sale
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Valid and Invalid Sales in Islamic Law
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, benefit, offer and acceptance, transfer of ownership, and delivery of the item.
In another example, Sarah pays a tutor for online teaching services. According to the Hanafi jurists, services may not be treated as commodities because they are not physical objects that can be stored. However, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
The Hanafi jurists also explained that a commodity or property (māl) must be something desirable and capable of being stored for future use. An object can be recognised as property if people generally see it as useful and valuable.
Mustafa Al-Zarqa criticised this definition and suggested a broader meaning. He defined property as any identifiable object that has material value to people.
Based on the Hanafi view, services and simple rights are not usually considered commodities because they are not physical objects that can be stored. However, the majority of Islamic jurists (fuqahāʾ) consider services and rights capable of ownership because the real benefit of physical property often comes from its use (usufruct).
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
In all cases, a sale in Islamic law must be based on a contract that includes an offer (ījāb) and an acceptance (qabūl) between the parties involved.
Case Scenario: Valid and Invalid Sales in Islamic Law
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Ahmad offers to sell the bicycle, and Bilal accepts the offer. After payment, Bilal takes possession of the bicycle. This is a valid sale because there is lawful ownership, benefit, offer and acceptance, transfer of ownership, and delivery of the item.
In another example, Sarah pays a tutor for online teaching services. According to the Hanafi jurists, services may not be treated as commodities because they are not physical objects that can be stored. However, the majority of Islamic scholars allow such transactions because the service provides recognised value and benefit.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal or dust, would also be invalid because such items are not recognised as valuable property in Islamic law.
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Islamic Law of Transaction - Definitions of Sale According to Islamic Scholars
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
Case Scenario: Valid and Invalid Sales
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Both parties agree to exchange ownership, and Bilal takes possession of the bicycle after payment. This is a valid sale according to Islamic law because there is lawful ownership, benefit, transfer of ownership, and delivery of the item.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal, would also be invalid in Islamic law because such items are not recognised as valuable property.
In Islamic law, a sale (bayʿ) means exchanging one item for another. The Arabic word bayʿ is used for both buying and selling, as mentioned in the Qur’an in verses [12:20] and [2:102].
The word bayʿ comes from the Arabic word bāʿ, meaning “arm,” because people stretch out their arms to give or receive items during a transaction. Another explanation is that people used to shake hands after completing a deal. Because of this, another Arabic word for a sale agreement is ṣafqa, which literally means “a handshake.”
According to the Hanafi School jurists, a sale is the exchange of a lawful and owned item (māl) for another item in a beneficial and specific manner. This definition excludes exchanges that bring no real benefit, such as swapping one identical coin for another identical coin. It also excludes worthless or prohibited items, such as dead animals or dust, because they are not considered valuable in Islamic law.
Al-Nawawi defined a sale as the exchange of one owned item for another together with the transfer of ownership from one person to another.
Similarly, Ibn Qudamah defined a sale as an exchange that not only transfers ownership, but also allows the new owner to take possession of the item.
Case Scenario: Valid and Invalid Sales
Ahmad sells his bicycle to Bilal for RM500. Ahmad legally owns the bicycle, while Bilal owns the money. Both parties agree to exchange ownership, and Bilal takes possession of the bicycle after payment. This is a valid sale according to Islamic law because there is lawful ownership, benefit, transfer of ownership, and delivery of the item.
On the other hand, if Ahmad exchanges one RM10 note for another identical RM10 note without any added value or benefit, it is not regarded as a proper sale because there is no meaningful exchange. Likewise, selling worthless or prohibited items, such as a dead animal, would also be invalid in Islamic law because such items are not recognised as valuable property.
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KembaraXtra – Legal Terms – Profession
A profession is an occupation that requires specialized intellectual knowledge, skill, education, or training, and it is treated distinctly from a trade in certain areas of law and taxation. Historically, profits from professions were taxed differently from profits arising from trades under the old Schedule D tax system. Although modern tax legislation no longer separates professions and trades into distinct tax cases, important differences remain. One notable distinction is that professional services supplied without charge do not generally create a taxable benefit, whereas goods transferred by a trader may still attract taxation. Courts have traditionally viewed professions as occupations primarily dependent upon intellectual skill rather than ordinary commercial activity. Examples commonly include lawyers, doctors, architects, and accountants.
The courts have also distinguished professions from trades and vocations through case law. In IRC v Maxse [1919], Lord Justice Scrutton described a profession as an occupation involving intellectual skill or manual skill controlled by intellectual expertise. Historically, companies were considered incapable of carrying on a profession because professional work depended upon the personal qualifications of individuals. However, modern developments have challenged this traditional view. Professional bodies, such as the The Law Society, now permit solicitors to practise through limited companies, reflecting changing commercial realities. Despite this evolution, legal uncertainty remains regarding whether a company itself can truly “carry on” a profession in the traditional sense. The concept of profession therefore continues to occupy an important place within taxation law, commercial law, and professional regulation.
A profession is an occupation that requires specialized intellectual knowledge, skill, education, or training, and it is treated distinctly from a trade in certain areas of law and taxation. Historically, profits from professions were taxed differently from profits arising from trades under the old Schedule D tax system. Although modern tax legislation no longer separates professions and trades into distinct tax cases, important differences remain. One notable distinction is that professional services supplied without charge do not generally create a taxable benefit, whereas goods transferred by a trader may still attract taxation. Courts have traditionally viewed professions as occupations primarily dependent upon intellectual skill rather than ordinary commercial activity. Examples commonly include lawyers, doctors, architects, and accountants.
The courts have also distinguished professions from trades and vocations through case law. In IRC v Maxse [1919], Lord Justice Scrutton described a profession as an occupation involving intellectual skill or manual skill controlled by intellectual expertise. Historically, companies were considered incapable of carrying on a profession because professional work depended upon the personal qualifications of individuals. However, modern developments have challenged this traditional view. Professional bodies, such as the The Law Society, now permit solicitors to practise through limited companies, reflecting changing commercial realities. Despite this evolution, legal uncertainty remains regarding whether a company itself can truly “carry on” a profession in the traditional sense. The concept of profession therefore continues to occupy an important place within taxation law, commercial law, and professional regulation.
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KembaraXtra – Legal Terms – Product Liability
Product liability refers to the legal responsibility of manufacturers, producers, suppliers, and other parties for damage caused by defective products. Under the Consumer Protection Act 1987, producers are subject to strict liability when defective products cause death, personal injury, or damage to private property. Strict liability means that the injured person does not need to prove negligence; it is sufficient to show that the product was defective and that the defect caused the damage. The law applies to a wide range of products, including goods, electricity, raw materials, agricultural products, and component parts. A product is considered defective if its safety is not such as persons generally are entitled to expect. This legal regime was introduced to strengthen consumer protection and to align UK law with European legal requirements concerning product safety.
Liability under product liability law may extend beyond the actual manufacturer. A person who places their brand name or trademark on a product may also be treated as a producer. Importers bringing products into the European Union can likewise be held liable, as can suppliers who fail to identify the producer or importer when reasonably requested by an injured party. Several defences are available under the Act, including contributory negligence, absence of the defect at the relevant time, or the “development risks defence,” where scientific knowledge at the time was insufficient to discover the defect. Claims must generally be brought within three years from the date the claimant became aware of the damage and the relevant facts, subject to an overall ten-year limitation period from the date the product entered circulation. Liability cannot be excluded through contractual terms or notices, thereby ensuring strong consumer protection. In addition to statutory liability, injured persons may also bring actions under contract law for breach of implied conditions or under tort law for negligence.
Product liability refers to the legal responsibility of manufacturers, producers, suppliers, and other parties for damage caused by defective products. Under the Consumer Protection Act 1987, producers are subject to strict liability when defective products cause death, personal injury, or damage to private property. Strict liability means that the injured person does not need to prove negligence; it is sufficient to show that the product was defective and that the defect caused the damage. The law applies to a wide range of products, including goods, electricity, raw materials, agricultural products, and component parts. A product is considered defective if its safety is not such as persons generally are entitled to expect. This legal regime was introduced to strengthen consumer protection and to align UK law with European legal requirements concerning product safety.
Liability under product liability law may extend beyond the actual manufacturer. A person who places their brand name or trademark on a product may also be treated as a producer. Importers bringing products into the European Union can likewise be held liable, as can suppliers who fail to identify the producer or importer when reasonably requested by an injured party. Several defences are available under the Act, including contributory negligence, absence of the defect at the relevant time, or the “development risks defence,” where scientific knowledge at the time was insufficient to discover the defect. Claims must generally be brought within three years from the date the claimant became aware of the damage and the relevant facts, subject to an overall ten-year limitation period from the date the product entered circulation. Liability cannot be excluded through contractual terms or notices, thereby ensuring strong consumer protection. In addition to statutory liability, injured persons may also bring actions under contract law for breach of implied conditions or under tort law for negligence.