Do They Teach You This in Business School? (Hadith No. 1829)
Volume 3, Book 34, Number 334 :
Narrated by Nafi
Ibn ‘Umar (radiallaahu `anhu) told us that the people used to buy food from the caravans in the lifetime of the Prophet (sallallaahu `alayhi wasallam). The Prophet (sallallaahu `alayhi wasallam) used to forbid them to sell it at the very place where they had purchased it (but they were to wait) till they carried it to the market where foodstuff was sold. Ibn ‘Umar (radiallaahu `anhu) said, ‘The Prophet (sallallaahu `alayhi wasallam) also forbade the reselling of foodstuff by somebody who had bought it unless he had received it with exact full measure.’
There are two principles outlined in this narration:
- Incoming trade caravans should not be stopped before they reach the city market(s). It’s likely that they might sell their items for lesser than the market rate and suffer losses.
- A person who buys something from another must not resell it unless he has possession of the bought thing. Details follow..
It was narrated from Tawoos from Ibn ‘Abbaas (may Allah be pleased with him) that the Messenger of Allah (blessings and peace of Allah be upon him) forbade selling foodstuff until one has received it in full. I [the narrator] said to Ibn ‘Abbaas: Why is that? He said: Because they are exchanging dirhams for dirhams, but the delivery of food is delayed?
Narrated by al-Bukhaari, 2132; Muslim, 1252
Ibn Hajar said in Fath al-Baari, 4/349:
What is meant is that he was asking about the reason for this prohibition, and Ibn ‘Abbaas replied that if the purchaser sells it before taking possession of it when the item is still in the possession of the seller, it is as if he sold dirhams for dirhams. This is explained by what is mentioned in the report of Sufyaan from Ibn Tawoos that is narrated by Muslim. Tawoos said: I said to Ibn ‘Abbaas: Why is that? He said: Don’t you see that they are exchanging gold, but the delivery of food is delayed? i.e., if he buys foodstuff for one hundred dinars, for example, and he gives the money to the seller but does not take the foodstuff from him, then he sells the foodstuff to someone else for one hundred and twenty dinars and takes it from him when the food is still in the possession of the (first) seller, then it is as if he sold one hundred dinars for one hundred and twenty dinars, it looks as if he sold one hundred dinars for one hundred and twenty. According to this interpretation the prohibition is not restricted only to foodstuffs. Hence Ibn ‘Abbaas said: I think that all things are like this. And this is supported by the hadeeth of Zayd ibn Thaabit, according to which the Messenger of Allah (blessings and peace of Allah be upon him) forbade selling a product in the place where it was bought until the merchants have taken it to their own places.
Narrated by Abu Dawood; classed as saheeh by Ibn Hibbaan. End quote.
Al-‘Ayni said in ‘Umdat al-Qaari (11/250):
What this means is: If he buys some food from a man for one dirham to be delivered later, then he sells it back to him or to someone else before taking possession of it for two dirhams, for example, that is not permissible because it is in effect selling cash for cash, when the food is not there. So it is as if he sold his dirham with which he brought the food for two dirhams, which is riba, because it is selling something that is not there (not in the possession of the seller) for cash. So this (transaction) is not valid. End quote.
Shaykh Ibn Baaz said:
It is not permissible for a Muslim to sell an item for cash or credit unless he owns it and has taken possession of it, because the Prophet (blessings and peace of Allah be upon him) said to Hakeem ibn Hizaam: “Do not sell that which you do not possess.” And he (blessings and peace of Allah be upon him) said, according to the hadeeth of ‘Abdullah ibn ‘Amr ibn al-‘Aas (may Allah be pleased with him): “It is not permissible to take a loan and sell at the same time or to sell that which is not in your possession.” Narrated by the five with a saheeh isnaad. Similarly, the one who buys it does not have the right to sell it until he also takes possession of it, because of the two hadeeths quoted above and because of the report narrated by Imam Ahmad and Abu Dawood, and classed as saheeh by Ibn Hibbaan and al-Haakim, from Zayd ibn Thaabit (may Allah be pleased with him) who said: The Messenger of Allah (blessings and peace of Allah be upon him) forbade selling a product in the place where it was bought until the merchants have taken it to their own places. And because of the report narrated by al-Bukhaari in his Saheeh from Ibn ‘Umar (may Allah be pleased with him), who said: I saw the people at the time of the Messenger of Allah (blessings and peace of Allah be upon him) trading in foodstuff without measuring it, and they would be punished if they sold it before moving it to their own places. And there are many hadeeths on this topic.
End quote from Majmoo‘ Fataawa ash-Shaykh Ibn Baaz, 19/64