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Business partnership in Islam
Question:
There is a partnership system in business that one contributes capital money while the other contributes his efforts to start new business after preparing all kind of documents related to business, on condition that whatever profit will be gained, both parties will distribute it among them according to agreed percentage. Is it lawful to do this type of business, while the second party does not know the real source of income of the first party whether his source of income is lawful or unlawful? Please answer in detail.
Answer:
Business partnership in Islam is allowed, aforesaid partnership system of business is called (Mudhaarabah) in Islamic term, i. e, one invests his money and the other contributes his efforts to handle it. If both parties have decided benefit percentage according to their prescribed documents, then it is allowed in the light of Shari’ah. If the second party knows that the source of income of first party is unlawful then he should avoid doing partnership in business with him, if he does not know the source of income, he may do partnership business with him. There is no need to investigate the source of income of the first party. This type of business partnership in Islam is allowed.
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