(Series of Answers by the Eminent Scholar Ata bin Khalil Abu al-Rashtah, Ameer of Hizb ut-Tahrir, to Questions from Visitors to his Facebook Page "Fiqhi")
Answer to a Question
Question:
Assalamu Alaikum Wa Rahmatullah Wa Barakatuhu. As you know, my dear brother, the sale of gold cannot be deferred; it must be hand-to-hand (yadan bi yad), as mentioned in the hadith... Does this apply to jewelry?
The context of this question is the following reality:
Gold sold as jewelry is usually 18-karat, not 24-karat. 24-karat gold is pure gold at a rate of 99.9%, which makes it difficult to shape. 18-karat gold consists of 75% gold and the remainder is metal such as copper or iron, which makes it malleable. Gold can even be colored based on the type of metal added. When selling this jewelry, the jeweler adds a craftsmanship fee (shiyaghah) on top of the gold price based on weight.
In this case, is jewelry considered a commodity like any other commodity containing gold, where sale on credit or deferred payment is permissible? Or does it still fall under the ruling of gold because gold is the dominant component (three-quarters or 75%)?
Another issue: when a jeweler sells jewelry, say a bracelet, there might be a small piece like a lock that is not gold—it might be platinum, zircon, or something similar. It is weighed with the jewelry, calculated in the weight, and multiplied by the gold price; meaning it is sold as if it were gold. Is this valid since it is a very small piece? Or must its price be separated? Or should it be considered part of the craftsmanship fee? What is your view?
May Allah bless you and reward you with all goodness on our behalf, and forgive us for taking your time...
Answer:
Wa Alaikum Assalam Wa Rahmatullah Wa Barakatuhu,
Before answering, I would like to point out that the rules of currency exchange (sharf) for ribawi items do not take into account the high quality of one type and the low quality of another. The ribawi items are those mentioned in the hadith narrated by an-Nasa'i from Ubada bin al-Samit that the Messenger of Allah ﷺ said:
الذَّهَبُ بِالذَّهَبِ تِبْرُهُ وَعَيْنُهُ وَزْنًا بِوَزْنٍ، وَالْفِضَّةُ بِالْفِضَّةِ تِبْرُهُ وَعَيْنُهُ وَزْنًا بِوَزْنٍ، وَالْمِلْحُ بِالْمِلْحِ، وَالتَّمْرُ بِالتَّمْرِ، وَالْبُرُّ بِالْبُرِّ، وَالشَّعِيرُ بِالشَّعِيرِ، سَوَاءً بِسَوَاءٍ مِثْلًا بِمِثْلٍ، فَمَنْ زَادَ أَوِ ازْدَادَ فَقَدْ أَرْبَى
"Gold for gold, its raw form and its minted form, weight for weight; silver for silver, its raw form and its minted form, weight for weight; salt for salt, dates for dates, wheat for wheat, and barley for barley, equal for equal, like for like. Whoever increases or seeks an increase has engaged in riba."
If you sell a ribawi item for the same genus, it must be like for like regardless of quality. A ratl of high-quality dates cannot be exchanged for two ratls of poor-quality dates. A saa’ of high-quality pure wheat cannot be exchanged for two saa’s of poor-quality impure wheat; the same applies to barley and salt. Similarly, for gold, a bar of pure gold cannot be exchanged for one and a half bars of impure gold; rather, it must be like for like, meaning the same weight.
These specific rules of exchange (sharf) differ from the rules for other transactions involving gold. For example, regarding Zakat, it is pure gold and pure silver that are considered. The Zakat for a 24k gold bar is different from the Zakat for an 18k bar of the same weight. Rather, the pure gold content is estimated when calculating the nisab (minimum threshold). Thus, the nisab for 24k gold is 85 grams, but the nisab for 18k gold is more than that because it is mixed with non-gold materials at a rate of one-quarter. This means 18k gold contains pure gold equivalent to three-quarters of 24k gold. Consequently, the nisab for 18k gold is one and one-third times the nisab of pure gold, which is 113.33 grams. Therefore, one who owns 85 grams of pure 24k gold has reached the nisab, and after a year (hawl) passes, they pay 2.5% of its weight in Zakat. However, one who owns 85 grams of 18k gold has not reached the nisab until their ownership reaches 113.33 grams; once the year passes, they pay 2.5% of its weight. It is clear here that for Zakat, the consideration is the pure gold content.
As for currency exchange (sharf), its rules are specific. Regardless of whether the ribawi item is pure or impure, high quality or low quality, unadulterated or mixed with others—it must be like for like as long as the sale of the ribawi item is for its own genus, provided that the pure and impure elements are mixed together (i.e., not separated) and the majority of the mixture is gold, such that it is called "gold."
The evidence for this is what Abu Sa'id narrated: Bilal brought some barni (high-quality) dates, and the Messenger of Allah ﷺ said to him:
مِنْ أَيْنَ هَذَا؟
"Where is this from?"
Bilal said: "We had some inferior dates, so I sold two saa’s of them for one saa’ [of these] to feed the Prophet ﷺ." At that, the Messenger of Allah said:
أَوَّهْ عَيْنُ الرِّبَا، لَا تَفْعَلْ، وَلَكِنْ إِذَا أَرَدْتَ أَنْ تَشْتَرِيَ التَّمْرَ فَبِعْهُ بِبَيْعٍ آخَرَ، ثُمَّ اشْتَرِ بِهِ
"Oh! This is the essence of Riba. Do not do that. Rather, if you want to buy dates, sell yours in a separate transaction, then buy with that [money]." (Reported by Muslim).
Abu Sa'id and Abu Hurayrah (may Allah be pleased with them) also narrated: The Messenger of Allah ﷺ appointed a man over Khaybar, and he brought him some janib (high-quality) dates. The Messenger of Allah ﷺ asked:
أَكُلُّ تَمْرِ خَيْبَرَ هَكَذَا؟
"Are all the dates of Khaybar like this?"
He replied: "No, by Allah, O Messenger of Allah! We take one saa’ of this for two saa’s, and two saa’s for three." The Messenger of Allah ﷺ said:
لاَ تَفْعَلْ، بِعْ الجَمْعَ بِالدَّرَاهِمِ، ثُمَّ ابْتَعْ بِالدَّرَاهِمِ جَنِيبًا
"Do not do that. Sell the mixed dates for Dirhams, then buy the high-quality dates with the Dirhams." (Agreed upon).
This applies to all ribawi items. It states in The Economic System, page 264 (Arabic version):
"If a man buys a sound Dinar from another man for two adulterated Dinars, it is not permissible. However, if he buys a sound Dinar for silver Dirhams, then buys two adulterated Dinars with those Dirhams, it is permissible... because of what Abu Sa’id narrated: 'Bilal came to the Prophet ﷺ with some barni dates, so the Messenger of Allah ﷺ said: From where is this? Bilal said: We had some inferior dates, so I sold two saa’s of them for one saa’ to feed the Prophet ﷺ. At that, the Messenger of Allah ﷺ said: Oh! This is the essence of Riba. Do not do that. Rather, if you want to buy dates, sell yours in a separate transaction, then buy with that.' (Reported by Muslim). Abu Sa'id and Abu Hurayrah also narrated: 'The Messenger of Allah ﷺ appointed a man over Khaybar, and he brought him some janib dates. The Messenger of Allah ﷺ asked: Are all the dates of Khaybar like this? He said: No, by Allah, O Messenger of Allah! We take one saa’ of this for two saa’s, and two saa’s for three. So the Messenger of Allah ﷺ said: Do not do that. Sell the mixed dates for Dirhams, then buy the high-quality dates with the Dirhams.' (Agreed upon)." [End quote]
It is clear from all this that ribawi items in the context of exchange must be like for like regardless of their quality as long as the name mentioned in the hadith applies to them, whether it is gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, or salt for salt.
Based on this, the answer to your question is as follows:
Jewelry made of silver or gold, regardless of its karat, must be like for like when exchanged for its own genus. For example, exchanging a Rashadi gold coin for a bracelet or similar—whether it is 21k or 18k—must be like for like. Any increase, whether for craftsmanship or profit, is not permissible. The solution in such a case—if the buyer or seller does not want a like-for-like exchange—is for the piece of gold to be sold for currency, and then that currency is used to buy the bracelet, necklace, or any other type.
When buying a gold bracelet that has a "lock" piece made of something other than gold and not mixed with it, such that it can be separated from it: then it must be separated, and the gold is weighed alone and sold for its own genus like for like. That [non-gold] piece is sold separately at whatever price is agreed upon. This applies if the purchase of the gold bracelet is being made with gold.
However, if you want to buy a gold bracelet that contains another piece of non-gold and you want to buy it with currency (paper money), then you may agree with him on any price you both find acceptable. If he weighs it all for you at a price he agrees upon with you, there is no problem, because the sale here involves two different genera (i.e., you are buying a bracelet with paper currency). In this case, he may weigh the entire bracelet including what is mixed or attached to it and sell it to you at the price you both agree upon, as long as you are buying the bracelet with a currency other than gold.
Your brother, Ata bin Khalil Abu al-Rashtah
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