DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - Very detailed questions about Zakah on Land

**FelikTen** · 12-05-2011, 11:47 AM

Salaam

For example how can no one be owning the land at any point?
I never said this. I said it will come into MY possession once I pay all the instalments. Till then, it's in the possession of the Real Estate Company and it's up to them to pay zakah if they wish. However, since it isn't mine, I don't have to pay zakah as appears to be the case per Mufti Ibn Adam's Fatwa.

Please wait for the next post where I will simplify the question.

Sorry I though I read something but I went back and did not see it. I find it hard to believe that ownership does not transfer until all the installments are paid.

I cannot be sure of the truth, but it is easily determinable by looking at the deed and the contract. I find it unbelievable because if ownership is not transferred until all the installments are paid, then the seller still has ownership. And it could be that after the potential buyer has paid 80% of the installments the seller can sell the property/land to some other buyer who is ready to pay cash right then. So the one who has paid 80% of the installments what did he pay it for?

The most likely scenario is that the sale has happened on a deferred payment basis, and there is a lien/mortgage on the same property by the seller preventing a sale without his permission - and this is permissible because once the property is sold on a deferred payment basis a debt obligation arises which permits the seller to take a lien/mortgage. If this is the case and the purchase (made on deferred payment) was with the intention of resale at a later time, then one will have to take the market value of the property into consideration as a zakaatable asset, but at the same time he can claim an offsetting deduction of debt which he owes to the seller (i.e. the deferred installments). However the asset will obviously be higher in value as the resale value is taken into consideration but the debt value is the book value and is locked in.

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A good point you have raised is whether or not the 50% of units given to the builder is a sale or not. This is a good question because this transfer to the builder could be considered a payment in lieu of building the building and not a sale.

However there is a principle that the worker cannot be paid from what he has worked on. So if someone is asked to make breads then his compensation cannot be some amount of the breads he has baked. I believe there are clear ahadith regarding this prohibition. Muftis/ulema should be consulted to determine whether or not the the builders taking some of the units which they have built for the owner of the land/building falls under the prohibition.

12-05-2011, 11:47 AM	#8
FelikTen Join Date Oct 2005 Posts 441 Senior Member	Salaam For example how can no one be owning the land at any point? I never said this. I said it will come into MY possession once I pay all the instalments. Till then, it's in the possession of the Real Estate Company and it's up to them to pay zakah if they wish. However, since it isn't mine, I don't have to pay zakah as appears to be the case per Mufti Ibn Adam's Fatwa. Please wait for the next post where I will simplify the question. Sorry I though I read something but I went back and did not see it. I find it hard to believe that ownership does not transfer until all the installments are paid. I cannot be sure of the truth, but it is easily determinable by looking at the deed and the contract. I find it unbelievable because if ownership is not transferred until all the installments are paid, then the seller still has ownership. And it could be that after the potential buyer has paid 80% of the installments the seller can sell the property/land to some other buyer who is ready to pay cash right then. So the one who has paid 80% of the installments what did he pay it for? The most likely scenario is that the sale has happened on a deferred payment basis, and there is a lien/mortgage on the same property by the seller preventing a sale without his permission - and this is permissible because once the property is sold on a deferred payment basis a debt obligation arises which permits the seller to take a lien/mortgage. If this is the case and the purchase (made on deferred payment) was with the intention of resale at a later time, then one will have to take the market value of the property into consideration as a zakaatable asset, but at the same time he can claim an offsetting deduction of debt which he owes to the seller (i.e. the deferred installments). However the asset will obviously be higher in value as the resale value is taken into consideration but the debt value is the book value and is locked in. ------------- A good point you have raised is whether or not the 50% of units given to the builder is a sale or not. This is a good question because this transfer to the builder could be considered a payment in lieu of building the building and not a sale. However there is a principle that the worker cannot be paid from what he has worked on. So if someone is asked to make breads then his compensation cannot be some amount of the breads he has baked. I believe there are clear ahadith regarding this prohibition. Muftis/ulema should be consulted to determine whether or not the the builders taking some of the units which they have built for the owner of the land/building falls under the prohibition.
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