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PROHIBITED
BUSINESS
ACTIVITIES
IN ISLAM
MBA 30(A)
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 1
ACKNOWLEDGEMENT:
First of all, we thanks to Allah, the almighty, for giving...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 2
ISLAMIC HISTORY AND BUSINESS
INTRODUCTION:
ISLAM & BUSINESS
Islam is a true...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 3
Similarly in MADINA business activities relates to SAHABA KARAM (R.A).
HAZR...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 4
1. DEALING OF HARAM ITEM:
Dealing in unlawful items such as Carrion (Dead m...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 5
Therefore, it is not permissible for Muslim to trade in dead meat and same ...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 6
2. Sale of Al-Gharar (Uncertainty, Risks, Speculation)
The Prohibitionof Gh...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 7
Speculation
Investment in stocks, property, etc. in the hope of gain but wi...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 8
As far as possible we must avoid making suspicion or speculations on others...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 9
Hadith Sahih Muslim
“Ma’mar (Allah be pleased with him) reported Allah's Me...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 10
“And let not those who are niggardly withrespect to what Allah has given t...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 11
The townsman should not sell for a man from the desert, leave the people a...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 12
one another; one of you should not enter into a transaction when the other...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 13
when you know that you are being unjust.''
It is reported in the Two Sahih...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 14
“Whoever bears arms against us is not one of us, and whoever cheats us is ...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 15
The Prophet (P.B.U.H) informs us in this Hadith that when a seller swears ...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 16
9. Dealing in Stolen Goods:
Almighty Allah has declared thievery unlawful ...
PROHIBITED BUSINESS ACTIVITIES IN ISLAM
Page 17
Conclusion:
From above discussion we conclude that islam gives full permis...
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Prohibited Business Transactions In Islam

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In this report we have discussed the Islamic Aspect of Business. We study about those business transactions which are permitted in Islam and also those which are prohibited in Islam. The Quranic and Hadiths references are also given.

Published in: Business
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Prohibited Business Transactions In Islam

  1. 1. PROHIBITED BUSINESS ACTIVITIES IN ISLAM MBA 30(A)
  2. 2. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 1 ACKNOWLEDGEMENT: First of all, we thanks to Allah, the almighty, for giving us the strength and will to do work on this project. We take this opportunity to express our profound gratitude and deep regards to our respectable teacher “Sir Abdul BasitQureshi” for his exemplary guidance, monitoring and constant encouragement throughout the courseof semester . The encouragement and guidance given by Him will help us in future life of study. We also like to pay gratitude to our group members (Wasim Aslam, Ishfaq Ali, Muhammad Wasim, Sehree Mumtaz & Badar-ud-Duja) for their constant encouragement and participation without which this project would not be possible.
  3. 3. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 2 ISLAMIC HISTORY AND BUSINESS INTRODUCTION: ISLAM & BUSINESS Islam is a true religion for all kind of mankind. It teaches and gives universal awareness and give concrete proof on the base of QURAN and SUNNAH. In context of business, Islam clearly prompt and persuaded the people to earn money through legal way. Intention about business in Holy Book of Quran: “Whereas Allah has permitted trading & forbidden Riba” (2:275) ALLAH give clearly massage to permission of business but along with indicate to prohibited activities of business in Islam. Islam and business have inspirational relation: The Prophet Muhammad’s (peace be upon him) first Profession was Trade. Historically analyzing the early Three hundred (300) years of Islam, we find out that Islam reached in Arab through trade and business activities. Sub-Continent, South Philippines, Indonesia, Europe, and Africa on these areas Islam reached through business and trade. Three main places of business transaction in Island Arab (Jazeera Arab).  MAKKAH  MADINA  TAIF In Makkah there were big markets of Textile, Silk and they were also doing the trade of Perfumery (Atar-farooshi), leather, gold, silver and agriculture. In Taif they were also doing business related to leather. Big industries of leather and wine factories were there. On the basis of pleasant weather, in field of agriculture they were better than other Arabs city.
  4. 4. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 3 Similarly in MADINA business activities relates to SAHABA KARAM (R.A). HAZRAT ABU BAKAR SADDIQUE (R.A) had a big factory of Textile at Sukh. HAZRAT UMER FAROOQ (R.A) was expanding his business from Hijaz to Najr. And also proved from history that he was doing business of weapons. Hazrat Usman Ghani (R.A) was a Textile Dealer and Hazrat Abdul Rahman Bin Auf(R.A) was related to business of Banaspati, cheese. Hazrat Zubair’s (R.A) business was related to Garments. Sahaba karam (R.A) did business under rule and restriction of Islam and always tried to avoid the prohibition of business. PROHIBITED BUSINESS ACTIVITIES IN ISLAM First and the most important aspect of business in Islam is ethics. In Islam conducting a business transaction varies from of unethical Business practices, Muslim should be avoid in that manner of business activity. Islam Prohibited Unethical Business Activities: 1. Dealing of Haram Items 2. Sale of Al-Gharar 3. Hoarding of Food Stuff 4. Exploitation of One’s Ignorance of Market Condition 5. Al-Najish (Trickery) 6. Cheating & Fraud in Business Transactions 7. Swearing 8. Giving Short Measure 9. Dealing In stolen Goods
  5. 5. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 4 1. DEALING OF HARAM ITEM: Dealing in unlawful items such as Carrion (Dead meat), Pigs and idols is strongly prohibited in Islam. Dead meat would mean the flesh of any bird or animal dead from natural causes, without being properly slaughter in Islamic way. Allah says in Quran-e-Pak. (surah Al-Ma’idah. Ayat no.3) Prohibited to you are dead animals, blood, the flesh of swine, and that which has been dedicated to other than Allah , and [those animals] killed by strangling or by a violent blow or by a head- long fall or by the goring of horns, and those from which a wild animal has eaten, except what you [are able to] slaughter [before its death], and those which are sacrificed on stone altars, and [prohibited is] that you seek decision through divining arrows. That is grave disobedience. This day those who disbelieve have despaired of [defeating] your religion; so fear them not, but fear Me. This day I have perfected for you your religion and completed My favor upon you and have approved for you Islam as religion. But whoever is forced by severe hunger with no inclination to sin - then indeed, Allah is Forgiving and Merciful. ‫ن‬ ‫کے‬ ‫اور‬ ‫کسی‬ ‫سوا‬ ‫کے‬ ‫ہللا‬ ‫جو‬ ‫اور‬ ‫گوشت‬ ‫کا‬ ‫سؤر‬ ‫اور‬ ‫خون‬ ‫اور‬ ‫ہے‬ ‫گیا‬ ‫دیا‬ ‫کر‬ ‫حرام‬ ‫ردار‬ُ‫م‬ ‫پر‬ ‫تم‬‫پر‬ ‫ام‬ ‫ر‬ِ‫گ‬ ‫اور‬ ‫واال‬ ‫مرنے‬ ‫کر‬ ‫لگ‬ ‫چوٹ‬ ‫اور‬ ‫واال‬ ‫مرنے‬ ‫کر‬ ‫گھٹ‬ ‫دم‬ ‫اور‬ ‫ہو‬ ‫گیا‬ ‫کیا‬ ‫ذبح‬‫سی‬ ‫اور‬ ‫واال‬ ‫مرنے‬ ‫کر‬‫نگ‬ ‫ک‬ ‫(اس‬ ‫تم‬ ‫جسے‬ ‫کہ‬ ‫کے‬ ‫اس‬ ‫سوائے‬ ،‫ہو‬ ‫کھایا‬ ‫نے‬ ‫درندوں‬ ‫جسے‬ ‫بھی‬‫وہ‬ ‫اور‬ ‫واال‬ ‫مرنے‬ ‫سے‬ ‫لگنے‬‫ے‬ ‫ک‬ ‫ذبح‬ ‫پر‬ ‫گاہوں‬ ‫قربان‬ ‫کی‬ ‫باطلہ‬ ِ‫معبودان‬ ‫جو‬ )‫ہے‬ ‫حرام‬ ‫(بھی‬ ‫وہ‬ ‫اور‬ ‫لو‬ ‫کر‬ ‫ذبح‬ )‫پہلے‬ ‫سے‬ ‫مرنے‬‫یا‬ ‫ی‬ ‫بانٹو۔‬ ‫ے‬ّ‫ص‬‫ح‬ ‫میں‬ ‫آپس‬ ‫ذریعہ‬ ‫کے‬ ‫تیروں‬ ‫تم‬ ‫کہ‬ ‫بھی‬ ‫بات‬ ‫یہ‬ ‫اور‬ ‫جائے‬‫کے‬ ‫آج‬ ‫ہے۔‬ ‫فسق‬ ‫سب‬ ‫ہ‬‫وہ‬ ‫دن‬ ‫ڈر‬ ‫نہ‬ ‫سے‬ ‫ان‬ ‫تم‬ ‫ہیں۔پس‬ ‫چکے‬ ‫ہو‬ ‫مایوس‬ ‫سے‬ )‫اندازی‬ ‫دخل‬ ‫(میں‬ ‫دین‬ ‫تمہارے‬ ‫ہوئے‬ ‫کافر‬ ‫جو‬ ‫لوگ‬‫و‬ ‫اپ‬ ‫نے‬ ‫میں‬ ‫پر‬ ‫تم‬ ‫اور‬ ‫دیا‬ ‫کر‬ ‫کامل‬ ‫دین‬ ‫تمہارا‬ ‫لئے‬ ‫تمہارے‬ ‫نے‬ ‫میں‬ ‫دن‬ ‫کے‬ ‫آج‬ ‫ڈرو۔‬ ‫سے‬ ‫مجھ‬ ‫بلکہ‬‫نی‬ ‫ط‬ ‫کے‬ ‫دین‬ ‫لئے‬ ‫تمہارے‬ ‫کو‬ ‫اسالم‬ ‫نے‬ ‫میں‬ ‫اور‬ ‫ہے‬ ‫دی‬ ‫کر‬ ‫تمام‬ ‫نعمت‬‫ج‬ ‫پس‬ ‫ہے۔‬ ‫لیا‬ ‫کر‬ ‫پسند‬ ‫پر‬ ‫ور‬‫و‬ ‫طرف‬ ‫کی‬ ‫گناہ‬ ‫وہ‬ ‫کہ‬ ‫میں‬ ‫حال‬ ‫اس‬ ‫ہو‬ ‫چکا‬ ‫ہو‬ ‫مجبور‬ )‫پر‬ ‫کھانے‬ ‫چیز‬ ‫(ممنوعہ‬ ‫سے‬ ‫شدت‬ ‫کی‬ ‫بھوک‬ ‫ہے۔‬ ‫واال‬ ‫کرنے‬ ‫رحم‬ ‫بار‬ ‫بار‬ )‫(اور‬ ‫واال‬ ‫بخشنے‬ ‫بہت‬ ً‫ا‬‫یقین‬ ‫ہللا‬ ‫تو‬ ‫ہو‬ ‫نہ‬ ‫واال‬ ‫جھکنے‬
  6. 6. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 5 Therefore, it is not permissible for Muslim to trade in dead meat and same as trade in pork or intoxicants, sale of Idols and statues are not permitted in Islam. The Holy Quran also says) Surah Al-Ma’idah. Ayat no. 90) “O ye who believe! Wine and the game of hazard and idols and divining arrows are only an abomination of Satan’s handiwork. So shun each one of them that you may prosper.” ‫جؤ‬ ‫اور‬ ‫چیز‬ ‫والی‬ ‫کرنے‬ ‫مدہوش‬ ً‫ا‬‫یقین‬ !‫ہو‬ ‫الئے‬ ‫ایمان‬ ‫جو‬ ‫لوگو‬ ‫وہ‬ ‫اے‬١‫قسمت‬ ‫سے‬ ‫یروں‬ِ‫ت‬ ‫اور‬ )‫بت(پرستی‬ ‫اور‬ ‫سب‬ ‫یہ‬ ‫آزمائی‬‫جاؤ۔‬ ‫ہو‬ ‫کامیاب‬ ‫تم‬ ‫تاکہ‬ ‫بچو‬ ‫طرح‬ ‫پوری‬ ‫سے‬ ‫ان‬ ‫پس‬ ‫ہیں۔‬ ‫عمل‬ ‫شیطانی‬ ‫ناپاک‬ The Prophet (P.B.U.H) is also reported to have said; “Allah and His Messenger made illegal the trade of alcoholic liquors, dead animals, pigs and idols.” (Bukhari, No: 2082) The Prophet (P.B.U.H) also said; "If Allah makes something unlawful, he makes its price also unlawful. (Ahmad, No: 2546)
  7. 7. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 6 2. Sale of Al-Gharar (Uncertainty, Risks, Speculation) The Prohibitionof Gharar There are numerous Hadiths forbidding Gharar sales, and specific instances thereof. One commonly cited Hadith was narrated by Muslim, 'Ahmad, 'Abu Dawud, Al Tirmidhi, Al Nasa'i, Al Darami and 'Ibn Majah on the authority of 'Abu Hurayra (R.A) (translation of the version in Muslim) that “The Prophet (P.B.U.H) prohibited the pebble sale and the Gharar sale.” A good translation of Gharar is "risk" or "uncertainty” Many classical examples of Gharar were provided explicitly in the Hadith. They include the sale of fish in the sea, birds in the sky, an unborn. Calf in its mother's womb, a runaway animal, the semen and unfertilized eggs of camels, un ripened fruits on the tree, etc. All such cases involve the sale of an item which may or may not exist. In such circumstances, to mention but a few, the fish in the sea may never be caught, the calf may be still born, and the fruits may never ripen. In all such cases, it is in the best interest of the trading parties to be very specific about what is being sold and for what price. For instance, 'Ahmad and 'Ibn Majah narrated on the authority of 'Abu Said Al Khudriy (mAbpwh): The Prophet (P.B.U.H)) has forbidden the purchase of the unborn animal in its mother's womb, the sale of the milk in the udder without measurement, the purchase of spoils of war prior to their distribution, the purchase of charities prior to their receipt, and the purchase of the catch of a diver. “Oh Prophet of Allāh! A man comes to me and asks me to sell him what is not with me, so I sell him [what he wants] and then buy the goods for him in the market [and deliver]'. And the Prophet (P.B.U.H) said: 'sell not what is not with you.” Hadīth: Sunan Abī Dāwūd, No.3503 An Islamic finance term describing a risky or hazardous sale, where details concerning the sale item are unknown or uncertain. Gharar is generally prohibited under Islam, which explicitly forbids trades that are considered to have excessive risk due to uncertainty.
  8. 8. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 7 Speculation Investment in stocks, property, etc. in the hope of gain but with the risk of loss the company's move into property speculation" 84. Avoid Suspicion (Speculation), Spying and Backbiting And do not pursue that of which you have no knowledge. Indeed, the hearing, the sight and the heart - about all those [one] will be questioned. (Surah No. 17, Al Isra (Bani Israil), Ayat No. 36) O believers ! Avoid suspicion (speculation) as much as possible: suspicion (speculation) in some cases is a sin: and spy not on each other, nor backbite on one another. Would any of you like to eat the flesh of his dead brother ? No ; you would hate it (so hate backbiting), and fear Allah: In fact, Allah is the One Who forgives and accepts repentance, Most Merciful. (Surah no. 49, al hujurat, ayat no. 12)
  9. 9. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 8 As far as possible we must avoid making suspicion or speculations on others matters, but if we speculate that a particular family is noble and very helpful then it is not prohibitted. Unneccessarily if we establish our views about bad habits of some persons or bad behaviour of some families then it is sin. Besides this if we start showing curiosity about the internal matters of some families and do spying for establishing our views then it is a big sin. Allah has Warned for not involving ourselves in back biting. Hadith: Said the Prophet Mohammad (saws) " If a person narrates the bad deeds of another person in his absence to others, it will be an act of backbiting. The companions of the prophet asked " If that person is possessing those bad deeds is it still a backbiting " the Prophet replied " If those bad deeds are narrated to that person and if he minds them then this is the backbiting, and if the evil deeds are not present, then these are allegations." (Muslim, Abu Daud and Tirmizi) 3. Hoarding of Food Stuff The Arabic word for hoarding is “Ihtikar”. It means storing foodstuffs or withholding them in expectation of rise in their prices. Sometimes, a handful of traders operating in the market buy the entire quantity of an item, rice for example, and store it up with the object of selling it later at the time of scarcity to draw maximum profit out of it and to dictate the prices. The consumers are left with no choice but to purchase the article concerned from the one who hoards, as he is the only one in the market who holds it. Sometimes, a trader hobnobs with the suppliers who will only sell their merchandise to him. As a result, he holds the entire stock of the essential items that other traders do not possess. He is, therefore, in a position to dictate his terms in the market and sell them at an exorbitantly high price to the needy people. This is an unjust practice and a clear case of exploitation and deservedly condemned by Islam. The Prophet (P.B.U.H) is reported to have condemned the hoarders when he said: “No one hoards but the traitors (i.e. the sinners).” (Abu Da’ud, No. 2990)
  10. 10. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 9 Hadith Sahih Muslim “Ma’mar (Allah be pleased with him) reported Allah's Messenger (may peace be upon him) as saying: He who hoards is a sinner. It was said to Sa'id (b. al-Musayyib): You also hoard. Sa'id said: Ma'mar who narrated this badith also hoarded.” (by Imam Muslim, translation by Abdul Hamid Siddiqui , Volume: The Book of Transactions (Kitab Al-Buyu`) 3910.) He (P.B.U.H) also said: “The importer [of an essential commodity] into the townwill be fed [by Allah], and the hoarder will have [Allah’s] curse upon him.” (Ibn Majah, No: 2144) 4. Exploitation of One’s Ignorance ofMarketConditions: One of the most common unethical practices in modern business is to exploit one’s ignorance of market conditions. Sometimes it may happen that a buyer arrives in a town with objects of prime and general necessity for selling them in the market. A local trader may persuade the new-comer to transfer all of the goods to him so that he will sell them on his behalf in the market. He obtains the commodities on a price that is lower than market price and then sells them at a high or exorbitant price. Islam condemns this act of intermediary intervention which involves exploitation of one’s ignorance of market conditions. The practice was prevalent in pre-Islamic society. The Holy Qur’an also says )Surah Al-Imran. Ayat no180)
  11. 11. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 10 “And let not those who are niggardly withrespect to what Allah has given them out of His bounty think that it is good for them; on the contrary it is bad for them. Soon that for whichthey were niggardly shall be their necklace on the Day of Resurrection. And only Allah is the Heir of heavens and earth and Allah is aware of your doings.” So same as Exploitation of One’s Ignorance of Market Conditions Prohibition discuss in Hadith. The Prophet (P.B.U.H) has prohibited this practice through a number of instructions. A tradition reads: SAHIH MUSLIM Book 10, Number 3628 Abu Huraira (Allah be pleased with him) reported it directly from Allah's Apostle (May peace be upon him): The townsman should not sell for a man from the desert (with a view to taking advantage of his ignorance of the market conditions of the city). And Zuhair reported from the Holy Prophet (P.B.U.H) that he forbade the townsman to sell on behalf of the man from the desert. SAHIH MUSLIM Book 10, Number 3628 SAHIH MUSLIM: Ibn 'Abbas (Allah be pleased with them) reported Allah's Messenger (May peace be upon him) as saying: The riders (carrying merchandise) should not be met in the way, and townsman should not sell for a man of the desert. The narrator reported. I said to Ibn 'Abbas: What do these words really imply-"The townsman for the man of the desert"? He said: That he should work as a broker on his behalf. Book 10, Number 3629: SAHIH MUSLIM: Jabir (Allah be pleased with him) reported Allah's Messenger (may peace be upon him) as saying:
  12. 12. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 11 The townsman should not sell for a man from the desert, leave the people alone, Allah will give them provision from one another. Yahya reported it with a slight change of words. Book 10, Number 3630 SAHIH MUSLIM: Jabir (Allah be pleased with him) reported a similar hadith from Allah's Apostle (May peace be upon him) through another chain of transmitters. Book 10, Number 3630 SAHIH MUSLIM: Ana’s b. Malik (Allah be pleased with him) reported: We were forbidden that a townsman should sell for a man of the desert, even if he is his brother or father. Book 10, Number 3632 SAHIH MUSLIM: Ana’s b. Malik (Allah be pleased with him) said: We were forbidden that a townsman should sell for a man of the desert. Book 10, Number 3633 A town dweller should not sell the goods of a desert dweller. (Bukhari, No: 2006) 5. Al-Najsh (Trickery) The term Al-Najsh means an action in which a person offers a high price for something, without intending to buy it, but just to cheat or defraud another person who really means to buy it. The person practising it may collaborate with the seller to offer high prices in front of the buyers merely as a means to cheat them. This type of fraudulent transaction is totally prohibited in Islam. The Prophet (P.B.U.H) is reported to have said: Do not harbour envy against one another; do not outbid one another [with a view to raising the price]; do not bear aversion against one another; do not bear enmity against
  13. 13. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 12 one another; one of you should not enter into a transaction when the other has already entered into it; and be fellow brothers and true servants of Allah. (Muslim, No: 4650) As is clear from the above, Islam also forbids the practice of sale over sale and purchase over purchase. This means that it forbids someone to offer a higher price for a commodity after the deal has been accomplished between the parties. Obviously he is offering a higher price in order to spoil the agreement reached between the parties. (Quran Surah Al-Baqara, Ayat no.188) And do not eat up your property among yourselves for vanities, nor use it as bait for the judges, with intent that ye may eat up wrongfully and knowingly a little of (other) people's property. Tafsir Ibn Kathir and eat up not one another's property unjustly (in any illegal way, e.g., stealing, robbing, deceiving), nor give bribery to the rulers (judges before presenting your cases) that you may knowingly eat up a part of the property of others sinfully.) Tafsir Ibn Kathir Ali bin Abu Talha reported that Ibn `Abbas said, "This (Ayah 2:188) is about the indebted person when there is no evidence of the loan. So he denies taking the loan and the case goes to the authorities, even though he knows that it is not his money and that he is a sinner, consuming what is not allowed for him.'' This opinion was also reported from Mujahid, Sa`id bin Jubayr, `Ikrimah, Al-Hasan, Qatadah, As-Suddi, Muqatil bin Hayan and `Abdur-Rahman bin Zayd bin Aslam. They all stated, "Do not dispute
  14. 14. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 13 when you know that you are being unjust.'' It is reported in the Two Sahihs that Umm Salamah narrated that Allah's Messenger said: (I am only human! You people present your cases to me, and as some of you may be more eloquent and persuasive in presenting his argument, I might issue a judgment in his benefit. So, if I give a Muslim's right to another, I am really giving him a piece of fire; so he should not take it.) Tafsir Ibn Kathir Quran 4:29. O you who believe! Eat not up your property among yourselves unjustly except it be a trade amongst you, by mutual consent. And do not kill yourselves (nor kill one another). Surely, Allah is Most Merciful to you.) Prohibiting Unlawfully Earned Money As a result of this offer the buyer may feel tempted to cancel his contract to sell it at a higher price. It may give rise to disputes and disagreements between brothers. Hence it is strictlyprohibited in Islam. 6. Cheating and Fraud in Business Transactions: The traders and businessmen generally have a tendency to motivate the customers by adopting fraudulent business practices. Islam strongly condemns all such practices in business transactions (Al-Ghashsh). The Messenger of Allah has commanded the believers not to indulge in cheating and fraudulent practices in business transactions. Sale of dead animal, dubious and vague transactions, manipulating the prices, selling the items belonging to a desert dweller by a townsman Al-Najsh (trickery), false eulogy and concealment of defects are all examples of cheating and fraud i.e. Al-Ghashsh. The Prophet (P.B.U.H) has strongly condemned all such practices in a number of traditions and the believer to abstain from them. Cheating and deception are despicable characteristics that are beneath a decent person. Intentionally distorting the truth in order to mislead others contradicts the values of honesty, which requires an attitude of sincerity, straightforwardness, and fairness that leaves no room for cheating, lying, trickery, or deceit. There are many texts from the Quran and the Sunnah conveying the meaning that cheating, whether the target be Muslims or non-Muslims, is forbidden. Accepting the guidance of Islam leads a person to truthfulness, which means a person completely avoids cheating, cheating, and back-stabbing. The Prophet of Islam said:
  15. 15. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 14 “Whoever bears arms against us is not one of us, and whoever cheats us is not one of us.” (Sahih Muslim) According to another report, the Prophet passed by a pile of food in the market. He put his hand inside it and felt dampness, although the surface was dry. He said: “O owner of the food, what is this?’ The man said: ‘It was damaged by rain, O Messenger of God.’ He said: ‘Why did you not put the rain-damaged food on top so that people could see it! Whoever cheats us is not one of us.” (Sahih Muslim) The Prophet (P.B.U.H) is reported to have said: The seller and the buyer have the right to keep the goods or return them as long as they have not parted. He also said that if both the parties have spoken the truth and described the defects as well as the merits thereof (the goods), they would be blessed in their deal. If they have told lies or concealed something, then blessings of their transaction would be lost. (Bukhari, No: 1937) 7. Swearing The traders often take recourse to swearing to emphasize that their items are of good quality. They claim qualities in the merchandise, which don’t exist. They try to persuade the buyers to purchase their commodity by invoking Allah’s name. Swearing in business for such purposes is forbidden in Islam, be it false or true. False swearing is an act of sin punishable by hellfire. Swearing by Almighty Allah is too great a thing to be used as a means to sell a commodity. The desirable thing in business transaction is that both the buyer and the seller remain straightforward and truthful in their dealings, so that no one will feel the need to swear by Allah in order to create conviction in the mind of the other party. The Prophet (P.B.U.H) is reported to have said: Swearing [by the seller] may persuade the customer to purchase the goods but the deal will be deprived of Allah’s blessing. (Bukhari, No: 1945) Abu Hurayrah (radhi allahu anhu) said, 'I heard the Messenger of Allah (P.B.U.H) saying, 'Swearing produces a ready sale for a commodity, but he will be deprived of Allah's blessings.'' [Agreed upon]
  16. 16. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 15 The Prophet (P.B.U.H) informs us in this Hadith that when a seller swears falsely concerning the worth of his goods, he may attain some benefit by selling a large quantity of it, but this is not a fair means of business. Even though, it increases the sale, it robs the business of its blessings. Therefore, even if a person is perfectly right in his statement in respect to his merchandise, he should not take an oath to influence his customers. Food for Thought: If one's perfectly true oath robs the deal of its blessings, then how great is the sin of those who take false oaths to sell their goods?!! Salman (radhi allahu anhu) narrated that Allah's Messenger (sallallahu aliahi wa-sallam) said, 'There are three types of people whom Allah will not speak to, and neither will He bless them, and for them is the severe torment. They are, (i) the white-hairedold adulterer, (ii) the arrogant beggar and (iii) the one who has made Allah as his merchandise, i.e., he does not purchase except by swearing (by Allah), nor does he sell except by swearing (by Allah).' [At-Tabaranee witha Saheeh isnad] The Prophet (P.B.U.H) informs us in this hadees that there are three categories of people to whom Allah will not speak on the Day of Resurrection nor will He cleanse them of their sins with forgiveness. This is because they committed sins without any excuse or justification and the first of these three is the fornicator and adulterer, who continues to sin in spite of his advanced years and consequent lessening of sexual urge, and his knowledge that the end of his life is near. The second is the man, who behaves arrogantly towards people, though; he possesses none of the wealth, rank or privilege, which often leads men to behave arrogantly. The third is the one, who treats Allah's Name with impropriety, frequently swearing by Him, Most High, without cause or valid excuse. In light of the above, those who frequently use the expression, 'Wallahi' (i.e. by Allah) should restrict themselves from such loose speech. 8. Giving Short Measures: Another form of deceit is to manipulate weights and measures. It refers to the act of taking full measures from others and giving them short measures in your turn. Giving short measures was a common malaise plaguing the pre-Islamic days. The community of the Prophet Shu‘ayb (sws) was known for practising it with impunity. Consequently, they were destroyed for their persistence in deceit and disbelief in Allah and His Messenger. Allah the Almighty has repeatedly commanded exactitude in weights and measures. One of the verses says: And give full measure when you measure, and weigh with a just balance. That is good and better in the end. (17:35)
  17. 17. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 16 9. Dealing in Stolen Goods: Almighty Allah has declared thievery unlawful and warned of severe punishment such as cutting the hand of the thief from the wrist joint if the necessary legal conditions for the award of punishment are met. Even if the thief escapes worldly punishment and gets away with stolen goods, it is not permissible for a Muslim to knowingly purchase or sell these items. The stolen items are neither to be bought nor sold by those who know the reality. The Prophet (sws) made the person knowingly buying a stolen commodity a partner to the crime. He said: The one who knowingly purchases a stolen good, is a partner to the act of sin and the shame. (Kanz Al-‘Ammal, No: 9258) Stealing is a sin, a big sin in Islam. How big a sin stealing is can be understood by understanding the following verse of Qur’an: “O Prophet (PBUH)! When believing women come to you to give the Bai’ah (the pledge), that they will not associate anything in worship with Allah, that they will not steal, that they will not commit illegal sexual intercourse, that they will not kill their children, that they will not utter slander, intentionally forging falsehood, and that they will not disobey you in Ma’ruf, then accept their Bai’ah, and ask Allah to forgive them. Verily, Allah is Oft-Forgiving, Most Merciful.” (Aayah No. 12, Surah Al-Mumtahanah, Chapter No. 60, Holy Qur’an). This verse is about ‘Oath of Allegiance’ for women. It can be seen that one of the requirements of the pledge was that a woman shall undertake that she shall not steal. Stealing has been included along with other grave crimes like Shirk, Illegal sex, Murder (of children) etc. I also wish to quote one hadith to highlight how grave a sin ste ling is:
  18. 18. PROHIBITED BUSINESS ACTIVITIES IN ISLAM Page 17 Conclusion: From above discussion we conclude that islam gives full permission of business and trade. Our Holy Prophet’s profession was trade. SAHABA KARAM (R.A) ‘s profession was also related to trade .But trade and business must be according to instructions of Quarn and Sunnah and it should be legal. Islam does’not allow any illegal and un-lawful business. Islam prohibit following business activities. 1. Dealing of Haram Items 2. Sale of Al-Gharar 3. Hoarding of Food Stuff 4. Exploitation of One’s Ignorance of Market Condition 5. Al-Najish (Trickery) 6. Cheating & Fraud in Business Transactions 7. Swearing 8. Giving Short Measure 9. Dealing In stolen Goods

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