Assalamu Alaikum Respected Mufti Sahib,
Please provide guidance on the following business partnership setup for a respected community member.
I’ve a question on the business partnership. We have started a business and have 5 partners, Alhumdulillah 4 of us has their share as 100% halal income from their salary savings. One of the partners has declared that his source of income is around 55% from regular halal business but 45% from the Lottery and Cigarette selling. But at he end of the day all his income is deposited in one bank. Now what are his partnership options:
1. Can he make intention that he is participating from his halal income only?
2. Can he participate only 55% of his share and rest should be returned to him?
3. We should not use him as partner.
4. Any other possibility
Bismillahi Ta’ala
Walaikum Assalam Warahmatullah,
It is indeed a good sign that the partners are worried about the nature of wealth of new investor. May Allah reward them all for this positive characteristic. Ameen
Let’s look at the broader sharʿi principles revolving partnership and then zero into your scenario.
Sharīʿah Basis: Purity of Capital
In Sharīʿah, the legitimacy of a partnership (sharīkah) depends upon the legitimacy of the capital invested. A partnership involving wealth derived from ḥarām sources is impermissible, as it entails cooperation in sin and the use of unlawful wealth.
The Qur’an forbids cooperation in sinful matters:
“And do not assist one another in sin and transgression.” (Sūrat al-Mā’idah 5:2)
Therefore, if a partner knowingly contributes capital from ḥarām earnings (such as interest, gambling, or sale of prohibited items), then participating with him constitutes indirect approval of those means.
Agency and Mutual Responsibility
In a partnership, all partners act as agents (wakīl) for one another in policy decisions. Each partner’s action represents the group, and profits and losses are attributed collectively. Hence, when one partner engages in an unlawful financial act, such as investing wealth tainted with ḥarām, the moral responsibility extends to all. Mukhtaṣar al-Qudūrī mentions, “All partners are agents (wakīl) of one another, and each is a trustee (amīn) for the other.” (Mukhtaṣar al-Qudūrī 2/56)
Mixed Wealth
Classical jurists discussed the case of wealth that is mukhtalaṭ (a mixture of lawful and unlawful earnings).
“When a person earns wealth through unlawful means and mixes it with his own lawful wealth, the fatwā is now upon the opinion of al-Karkhī that it is permissible to transact with him, removing hardship due to the prevalence of mixed wealth.” (Radd al-Muḥtār, Kitāb al-Buyūʿ 7/490)
However, this leniency applies only when the ḥalāl portion is dominant and the ḥarām is minimal or unintentional. When the unlawful component reaches a significant portion (such as 45% in this case) the assumption of purity cannot be made.
Thus,
- If the lawful portion predominates, limited transactions are tolerated to prevent undue hardship (rafʿ al-ḥaraj).
- If the unlawful portion predominates or cannot be separated, the wealth is impure, and partnership becomes impermissible.
Separating the Pure portion from Mixed Wealth
Where the proportion of ḥalāl wealth is clearly known, partnership is permissible only up to that portion. If 55% of the person’s total wealth is verifiably ḥalāl, he may invest only that 55% of the intended capital, while the remaining 45% must not be included in the business.
Mufti Taqi Uthmani mentions:
“If one mixes the usurped or ḥarām wealth with his own ḥalāl wealth, it is permissible for him to benefit in proportion to his lawful share, and whoever takes from him through gift, purchase, or inheritance may benefit likewise in that proportion.” (Fiqh al-Buyūʿ 2/1054)
Hence, the partner may invest only the confirmed lawful portion, provided that it can be separately identified, documented, and deposited independently from the mixed account.
Case Where Separation Is Not Possible
If all his wealth has been deposited into a single account and the ḥalāl and ḥarām components are indistinguishably mixed, then mere niyyah (intention) to invest from the ḥalāl part does not purify the capital. Such participation would be impermissible, as it risks introducing ḥarām wealth into the joint pool. Thus, when ownership is uncertain due to unlawful earnings, partnership cannot be built upon such ambiguity. (See Fatḥ al-Qadīr, Kitāb al-Buyūʿ 29/116)
Recommendation in the inquired scenario
- Mere intention is insufficient: Intending that only the ḥalāl portion is used does not make the capital lawful when the funds are mixed and inseparable.
- Partial participation is possible only if separation is verifiable: If the partner can clearly extract and document the 55% that is ḥalāl before contributing, then partnership may be allowed on that portion alone.
- If separation is not possible, he should not be taken as a partner: Admitting a partner with mixed and largely doubtful wealth exposes the business to shubha (doubt) and collective liability.
- Encourage purification of wealth: He should remove the ḥarām portion—by donating it to charity without intention of reward—and begin anew with a clean capital.
Final Thoughts
This situation also presents a valuable opportunity for brotherly naṣīḥah and spiritual growth. The partners should approach the brother with kindness and sincerity, encouraging him to reflect on his financial inflows and to begin purifying them from impermissible sources. Rather than merely excluding him, invite him to take positive steps toward aligning his income entirely with Sharīʿah principles, by gradually discontinuing the ḥarām trades and focusing on ḥalāl means of livelihood.
He may then, with a cleansed source of income, rejoin the partnership so that the capital, effort, and profit are all rooted in purity. In doing so, not only will he safeguard his earnings from sin, but he will also invite the barakah (divine blessing) of Allah into his business and household, for as the Prophet ﷺ said:
“Indeed, Allah is Pure and accepts only that which is pure.” (Ṣaḥīḥ Muslim 2/703 #1015)
And Allah Ta’āla Knows Best
Mufti Faisal al-Mahmudi