Question:

If a man buys a commodity for 10 thousand, he pays a portion of its price upfront and the rest through installments over a year for example. If the seller came to the buyer after the third month, for example, and told him: If you pay me the remaining money, which is five thousand for example, I will deduct one thousand, so I will collect from you four thousand only. Is this considered sale of debt with less than its cost for the sake of expediting payment or is it considered forgiveness only and not selling in debt?

And if this was permissible, how is it different from having two prices for the commodity in one contract?

Answer:

Expediting paying the postponed debt on condition of deducting part of it is not selling debt by debt, but it is in Fiqh under the category of "place and hasten" (ضعْ وتعجَّل), which means: pay some of the postponed debt, in return of expediting paying the debt.

As for debt for debt, an example is when a man lends from you one thousand dinars, and with it, you buy one hundred kilos of lentils from him, which he gives you after one month. In this case, you have sold the debt of 1000 dinars with the postponed lentils i.e. debt. This is forbidden because it is selling debt by debt; moreover, he gave the capital debt which is haram because he sold debt for debt. Furthermore, he gave the capital debt which is haram since the capital needs to be received at the beginning of the transaction.

Another example for debt by debt is when Amr has a debt of 1000 dinars from you, and Zaid has a debt from me of 100 dresses, so I tell you that I will sell you the 100 dresses with Zaid for the 1000 dinars that you have with Amr... This is selling debt by debt....

And there are other examples of selling debt by debt also called: (بيع الكالئ بالكالئ) "al-Kal'ibi al-Kal'I" or the "an-Nasee'ah by an-Nasee'ah"...(النَّسِيئَةُ بِالنَّسِيئَةِ)

Selling for other than the debtor is Haram certainly, as the Hadith of al-Hakem in his Mustadrak 'ala al-Saheehayn. Ibn Umar (raa) narrated that the Prophet (saw) "نَهَى عَنْ بَيْعِ الْكَالِئِ بِالْكَالِئِ" "forbade the selling of something to be collected later by something to be collected later". In another narration, the following is added: "هُوَ النَّسِيئَةُ بِالنَّسِيئَةِ" "it is credit (when payment is done at a later time) by credit."

As to selling of debt by debt to the debtor, there is a difference in opinion, as some say it is permissible, while others say it is forbidden.

As for your question, it is for jurists (fuqaha') as we have said under the section "place and hasten" "ضعْ وتعجَّل" that means pay some of the postponed debt as to pay all the debt or part of it quicker... And there is a difference in opinion about this question:

- Some do not permit it, and some of the evidences they refer to are:

ما أخرجه البيهقي في سننه الكبرى عَنِ الْمِقْدَادِ بْنِ الْأَسْوَدِ قَالَ: أَسْلَفْتُ رَجُلًا مِائَةَ دِينَارٍ، ثُمَّ خَرَجَ سَهْمِي فِي بَعَثٍ بَعَثَهُ رَسُولُ اللهِ صَلَّى اللهُ عَلَيْهِ وَسَلَّمَ، فَقُلْتُ لَهُ: عَجِّلْ لِي تِسْعِينَ دِينَارًا وَأَحُطُّ عَشَرَةَ دَنَانِيرَ، فَقَالَ: نَعَمْ، فَذَكَرَ ذَلِكَ لِرَسُولِ اللهِ صَلَّى اللهُ عَلَيْهِ وَسَلَّمَ، فَقَالَ: «أَكَلْتَ رِبًا يَا مِقْدَادُ، وَأَطْعَمْتَهُ

1- It is narrated by al-Baihaqi in his Sunnan Qubra on authority of al-Miqdad bin al-Aswad that he said: I lent a man 100 dinars, and then my arrow came from the convoy that Prophet Mohammad sallalahu alaihi wassalam has sent, so I told him: ‘Hurry and give me 90 dinars, and I will put 10 dinars. The man said: ‘Yes, and he mentioned that to Prophet Mohammad sallalahu alaihi wassalam so he said: "You've eaten from usury oh Miqdad, and fed from it".

(Note: Imam Ibn al-Qayyim said in Ighathat al-Lahfan: "there is weakness in the sanad (chain of narration) of the Hadith of al-Baihaqi").

2. They said that it is known that the riba (usury) of al-Jahiliyya was nothing but a postponed debt with a conditional increase, so the increase was instead of increasing the time, then Allah (swt) annulled it and made it forbidden (haram) and He (swt) said:

((وإن تبتم فلكم رءوس أموالكم))

"But if you repent, you may have your principal." They added that deducting some of the debt instead of rounded-term is also forbidden because of the impact compensation on the term, whether an increase or a decrease.

Most of the jurists from al-Hanafiyya, al-Malikiyya, al-Shafi'iyya, and al-Hanabilah said that "place and hasten" is forbidden, and Zaid bin Thabet, Ibn Umar detested it as well as others from the Tabi'in (followers).

- Some permit it, and some of the evidences they refer to are:

1. It is narrated by Ibn Abbas (raa) that he said: When the Messenger of Allah sallalahu alaihi wassalam wanted to banish Bani an-Nadheer, they said: O Messenger of Allah, you ordered our banishment and we have unresolved debts, so he said: "Place and hasten" narrated by al-Hakem in his Mustadrak 'ala as-Saheehayn and said this is a Hadith with Isnad Sahih.

عَنِ ابْنِ عَبَّاسٍ رَضِيَ اللَّهُ عَنْهُمَا، قَالَ: لَمَّا أَرَادَ رَسُولُ اللَّهِ صَلَّى اللهُ عَلَيْهِ وَسَلَّمَ أَنْ يُخْرِجَ بَنِي النَّضِيرِ قَالُوا: يَا رَسُولَ اللَّهِ، إِنَّكَ أَمَرْتَ بِإِخْرَاجِنَا وَلَنَا عَلَى النَّاسِ دُيُونٌ لَمْ تَحِلَّ، قَالَ: «ضَعُوا وَتَعَجَّلُوا» رواه الحاكم في مستدركه على الصحيحين وقال هَذَا حَدِيثٌ صَحِيحُ الْإِسْنَادِ وَلَمْ يُخَرِّجَاهُ

(Note: a-Thahabi said in his Tal'khees that al-Zinji is weak, and Abdul-Aziz is not trustworthy. Ibn al-Qayyem said in Ahkam Ahl al-Dhimma "Its Isnad is Hasan and no one is in it except Muslim bin Khaled al-Zinji, and his Hadith does not degenerate from the rank of Hasan").

2. The saying of Abdullah Ibn Abbas (ra): "Usury is nothing but postponement for me, and I will increase for you" and not "Hasten to me, and I will put for you."

قول عبد الله بن عباس رضي الله عنهما: "إنما الربا أَخِّرْ لي وأنا أزيدك" وليس "عَجِّلْ لي وأنا أضع عنك

The permissibility of this was narrated by Ibn Abbas, an-Nakh'i, al-Hasan, and Ibn Seereen, and this narration is from Imam Ahmad and another from al-Shafi'iyyah. This is the choice of Sheikh al-Islam Ibn taymiyah and his student Ibn al-Qayyem, and Ibn 'Abdeen, from the jurists of al-Hanafiyyah, has authorized it as in his footnotes of Ad-Dhor al-Mokhtar.

We do not like to adopt an opinion in this issue, thus the person with this question can follow (fa yuqalid) the opinion of the jurists (fuqaha') which s/he finds reassuring...

And as you can see this issue differs from the other issue about selling for cash or with installments. If the seller said that the price of this commodity is 1000 cash or 1,300 with installments, and it was left as a variable then it is not permissible because the price is unknown. However, if the price was specified, and the buyer said: I will buy it with a certain amount of cash money, or he said I will buy it with a certain number of installments, then this is permissible as the price is specified, and the commodity has one cost.