Abu Dawud

Benefits and Issues:
Benefit:
When the one holding the pledged item (rahn) spends on an animal,
then he may also derive benefit from it.
Whether the owner has given permission or not.
But this ruling applies only to living creatures.
In the case of a house,
vehicle,
or land, etc., this ruling will not apply.
If someone has taken a house as collateral, he cannot derive benefit from it.
Therefore, he should neither rent it out and consume its rent, nor reside in it himself.
In both cases, the rent should be paid to the owner of the house.
It is not correct to make an analogy between a house or shop and an animal.
(For further details, refer to the books of fiqh.)

Hadith Commentary:
(1)
The chapter heading established by Imam Bukhari rahimahullah is, in fact, the wording of a hadith which Imam Hakim rahimahullah has narrated in his *al-Mustadrak* (al-Mustadrak lil-Hakim: 2/58). However, Imam Tirmidhi has considered this hadith to be mawquf (attributed to a Companion, not the Prophet) (Jami‘ al-Tirmidhi, al-Buyu‘, Hadith: 1254).

(2)
After giving a loan, keeping something belonging to the debtor as security to ensure repayment is called a pledge (rahn). Regarding benefiting from the pledged item, scholars have different opinions, the details of which are as follows:

✦ It is permissible and lawful to benefit from the pledged item in an absolute sense.

✦ The basis of the pledge is the loan, and any benefit derived from a loan is considered usury (riba); therefore, benefiting from the pledged item is a form of riba and is thus unlawful and prohibited in Shari‘ah.

✦ In reality, the pledged item remains the property of the original owner, so its protection and maintenance are also his responsibility. If this is impossible or difficult, or if he himself relinquishes this responsibility, then the one with whom the item is pledged is permitted to benefit from it to the extent of the protection costs.

According to us, this last opinion seems closer to reason, but there are some details: if the pledged item is an animal that gives milk or is suitable for riding, then it is permissible to benefit from it to the extent of the expenses incurred for its protection and supervision. In this case, placing the burden of protection on the original owner would be a hardship for both parties.

The Messenger of Allah sallallahu alayhi wa sallam said:
“If a riding animal is pledged, it may be ridden due to the expenses incurred, and if it is a milking animal, its milk may be drunk due to the expenses incurred. Whoever rides or drinks is responsible for the animal’s maintenance and care.” (Sahih al-Bukhari, al-Rahn, Hadith: 2512)

It should be clear that the benefit of riding or drinking milk is due to the expenses incurred, and the one intended here is not the original owner but the person with whom the item is pledged, as is explicitly stated in some narrations (Sunan al-Daraqutni, al-Buyu‘, Hadith: 2906). Also, only the person who bears the expenses may benefit, because the original owner’s benefit is not due to bearing expenses but due to ownership.

Furthermore, this benefit is limited to personal use; selling the milk or renting out the riding animal is not permissible. Some scholars advise such caution that one should not benefit beyond the expenses incurred. Thus, Ibrahim al-Nakha‘i said:
“If a riding animal is pledged, it may be ridden to the extent of the expenses. Similarly, milk may be taken from a milking animal to the extent of the fodder.” In another narration: “Taking more milk than the price of the fodder is riba.” (Fath al-Bari: 5/178)

However, such meticulous calculation is mere overburdening. If the pledged item is such that its protection and supervision incur no expense, such as jewelry or valuable documents, then benefiting from it is not permissible, as this would be benefiting in exchange for a loan, which clearly resembles riba.

If the pledged item is land, there is a difference of opinion among the scholars of our subcontinent. Mawlana Muhammad Husayn Batalwi rahimahullah, by analogy with the aforementioned hadith of Bukhari, issued a fatwa permitting benefit from pledged land, as detailed in Fatawa Thana’iyyah (1/409).

In the same Fatawa Thana’iyyah, Mawlana Sharfuddin Dehlawi rahimahullah gave a detailed response that a general claim requires a general proof. Here, the general or unspecified has been analogized to a specified text, and it is also a principle that a ruling contrary to analogy remains restricted to the text, because in principle, property is categorically prohibited (from such benefit). Therefore, unless there is explicit evidence of permissibility, analogy cannot establish it, especially for a ruling that is contrary to analogy. This discussion in Fatawa Thana’iyyah is lengthy and worthy of study.

Sayyid Nadhir Husayn Muhaddith Dehlawi, Mawlana Abdur Rahman Mubarakpuri, Mawlana Abdul Rabb, Mawlana Sayyid Abdul Jabbar bin Abdullah Ghaznawi, and Mawlana Hafiz Abdullah Rupuri rahimahumullah are of the opinion of impermissibility.

Hafiz Ibn Hajar rahimahullah, discussing the hadith of Bukhari, writes:
“This hadith is evidence for those who permit benefiting from the pledged item, provided it is maintained, even if the original owner does not permit it. One group believes that the pledgee (murtahin) is entitled only to ride or take milk to the extent of the expenses incurred, and no other benefit, as is apparent from the hadith. However, the majority of scholars hold that the one with whom the item is pledged cannot benefit from it in any way. Regarding the mentioned hadith, their position is that it mentions benefit, but this is contrary to analogy, so it remains restricted to the text and it is not correct to open the door to further analogy and benefit. It is contrary to analogy because it permits riding and taking milk without the owner’s permission. In another hadith, it is stated that one should not take milk from an animal without the owner’s permission.” (Sahih al-Bukhari, Hadith: 2435)

Moreover, the right to benefit is only due to bearing the expenses, not in exchange for the loan. (Fath al-Bari: 5/178)

At this point, it seems appropriate to include a fatwa of Sayyid Nadhir Husayn Muhaddith Dehlawi rahimahullah along with the question:

✦ The question is: If someone pledges land, can the pledgee benefit from it or not? ✦ The answer is given as follows: The pledgee may benefit from the pledged item to the extent of the expenses incurred, i.e., if a riding or milking animal is pledged and the cost of its feed and grass, etc., is borne by the pledgee, then it is permissible for the pledgee to ride or drink milk from the animal to the extent of his expenses, but it is not permissible for him to benefit beyond his expenses. For example, if the daily expense on a pledged cow is two rupees and the cow gives milk worth four rupees daily, then it is permissible for him to drink milk worth only two rupees, and the remaining two rupees’ worth of milk belongs to the pledgor (rahin); it is not permissible for the pledgee to drink the rest. If he does, it will be riba.

The Messenger of Allah sallallahu alayhi wa sallam said:
“If a riding animal is pledged, it may be ridden in exchange for the expenses, and the milk of a milking animal may be drunk in exchange for the expenses, and whoever rides or drinks will bear the expenses.” (Sahih al-Bukhari, al-Rahn, Hadith: 2511)

Also, in Sahih Bukhari, it is narrated from Ibrahim al-Nakha‘i that riding a lost animal is permitted in exchange for fodder, and the milk of a milking animal is also drunk in exchange for fodder, and the same ruling applies to a pledge.

Fath al-Bari further clarifies that if a milking animal is pledged with the pledgee, it is permissible for the pledgee to take milk equal to the price of the fodder; if he takes more, it is riba.

Secondly, it is not permissible to benefit from any other pledged item besides riding or milking animals, because there is no evidence for it; rather, there is prohibition. The hadith states that the Messenger of Allah sallallahu alayhi wa sallam said:
“A pledged item cannot be withheld from the pledgor. Its benefit and loss belong to the one who pledged it.” Imam Shafi‘i rahimahullah narrated this in his Musnad, and Imam Daraqutni rahimahullah in his Sunan, and said its chain is hasan and connected.

Allamah Shawkani rahimahullah writes in Nayl al-Awtar that the benefit and loss of the pledged item belong to the pledgor. This is evidence for the view of the majority. Imam Shafi‘i, Imam Abu Hanifah, Imam Malik, and the majority of scholars have said that the pledgee cannot benefit from the pledged item in any way. All benefit and loss belong to the pledgor, because the Shari‘ah has made the pledgor responsible for benefit and loss.

When both these points are established from the ahadith, it is clear that the pledgee cannot benefit from pledged land, and it is also clear that analogy of pledged land with a riding animal is not correct. (Fatawa Nadhiriyyah: 5/259) And Allah knows best.

It should be noted that the hadith mentioned in the fatwa:
“A pledged item cannot be withheld from the pledgor. Its benefit and loss belong to the one who pledged it.”
was narrated by Imam Hakim (al-Mustadrak lil-Hakim: 2/51). Some narrations indicate that the last words are an addition by Sa‘id ibn al-Musayyib rahimahullah as an explanation, but Imam Shafi‘i’s research is that the last words are also from the Messenger of Allah sallallahu alayhi wa sallam.

According to Imam Shafi‘i rahimahullah, the meaning of this hadith is that if something is pledged with someone else, the pledgor has full right to benefit from it, and the pledgee should not prevent him. If it is destroyed while with the debtor or creditor, the creditor’s right is not lost, because the loss is that of the debtor who pledged his property with the creditor. However, some other jurists interpret the hadith as follows: if the debtor fails to repay the loan by the appointed time, the pledgee does not have the right to seize the pledged item, but it should be sold to pay off the debt. If its price exceeds the debt, the benefit goes to the pledgor, i.e., the excess is returned to the debtor. If its price is less than the debt, the debtor must make up the difference.

From the context, the second interpretation seems correct, because a study of the Noble Qur’an shows that the creditor’s possession of the pledged item is recognized until the debt is repaid. Although ownership remains with the debtor, the right of security is recognized for the creditor. Granting the debtor the right to benefit from his property does not contradict the possession given to the creditor by the Qur’an. This interpretation is also transmitted from Ibrahim al-Nakha‘i, Tawus, Sufyan al-Thawri, and Imam al-Zuhri.

Mawlana Abdullah bin Abdul Jabbar Ghaznawi writes in his fatwa that, according to us, the real owner of the land is the borrower. Therefore, he has the right to cultivate it and benefit from it himself, but to ensure repayment of the loan, the documents and registry related to his land should be kept by the creditor. If for some reason this is not possible, then the one with whom the land is pledged may cultivate it himself, and after deducting the expenses incurred, the profit, etc., should be divided into two parts: one part for his own labor, and the other for the original owner of the land, or instead of giving a share, deduct the equivalent amount from the debt, or deduct the current annual rent of the land from the debt. In this way, when the debt is fully repaid, the land will be returned to the original owner.

In this regard, the following two common practices are completely unlawful and prohibited:
✦ The one with whom the land is pledged cultivates it himself and continues to use its produce, completely ignoring the original owner.
✦ If the debt is not repaid on time, the pledged land is seized in lieu of the debt.

Both these practices are unjust and oppressive, and should therefore be avoided.
And Allah knows best.