Zakat on a trust and whilst court case is going on

CategoriesZakah [204]

A made an agreement to sell his house with B for Rs. 10 millions. 3 millions were paid as advance and balance 7 millions were to be paid within 3 months. It was a condition of the agreement that in case the balance payment was not made within 3 months, the agreement would stand cancelled and the advance money received by A shall be refunded to B. B did not make the balance payment within stipulated time. Thereupon A asked B to receive back the advance money as per agreement. But B refused and sued A for specific performance of the agreement to sell. Now the matter is under litigation for last few years. The advance money and house is in possession of A. A used the advance money for his business and to payoff his liabilities. A considers the advance money of 3 millions to be a liability payable to B on resolution of the dispute. However, the court may decide the case in favour of A or B. In this regard I have the following questions. 1- whether Zakat is payable by A on his assets which are less than the advance money of 3 millions? 2- During the pendancy of the case what is the status of the advance money of 3 millions i.e. loan, Imanat, ownership etc? 3- Whether during the pendancy of case Zakat is payable on the advance money by either of A or B? 4- After the decision of case in favour of either of A or B how the Zakat should be paid on the advance money of 3 millions? Jazzakumullah.

In the name of Allah, the most Beneficent, the most Merciful.

Answer

  1. ‘A’ will have to pay zakaat on wealth besides the 3 million rupee as long as it reaches the value of Nisaab.  (Fatawa Mahmoodiyah p.50 v.3)
  2. The three million rupees will be considered as a trust “amanah” until the case is resolved.
  3. If someone places some zakaatable wealth in trust with someone else, then the person placing the goods in trust (i.e. owner) has to give zakaat on that wealth.  If he gives the entrusted person the choice to dispense his zakaat from that wealth, then it is permissible.  (Aapke Masaail p.352 v.3)
  4. If the decision of the case is in favour of the owner of the 3 million rupees his zakaat will be fulfilled.  However, if the decision is in favour of that person whose ownership was not established on the amount prior to the decision, then after he receives the money he will have to give zakaat as long as one year has passed.  (Fatawa Darul Uloom Deoband p.99 v.6)

Only Allah Knows Best

Mohammed Tosir Miah

Darul Ifta Birmingham

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