Nasai

From this hadith, it is understood that if a person borrows something and then denies it while witnesses are present, he will be considered a thief and his hand will be cut off. This is the position of Imam Ahmad and Ishaq and others, because this too is a type of theft, and in fact, its harm to society is even greater. If punishment is not enforced for this, people will refuse to lend things, which will cause difficulties for poor people. Furthermore, it resembles theft in that it is also a means of unlawfully seizing people’s protected property through trickery, and the same occurs in theft. Therefore, the punishment for this crime will also be the same as for theft.

And the Messenger of Allah (sallallahu alayhi wa sallam) is, by Shariah, authorized to clarify the applications of the Shariah; thus, some hadith scholars also hold the view that the hand should be cut off for this crime as well. However, the majority of scholars do not hold this view; rather, they enforce the cutting of the hand only for theft. They interpret this hadith in such a way that the Prophet (sallallahu alayhi wa sallam) did not cut off the hand for this crime, but rather for theft, as is clarified in some narrations that he had committed theft. This crime is mentioned only to further censure him. Since in other narrations and chains of transmission, the cutting of the hand for theft is explicitly mentioned, and the incident occurred only once, the preferred position is that of the majority: that the cutting of the hand will be only for theft. And Allah knows best.