Ruling on Bai' Salam (Forward Sale)

Written by: Al-Sheikh Mubashar Ahmad Rabbani (Hafidhahullah)

Question:

Is Bai' Salam (forward sale) permissible? Also, please provide an explanation of Bai' Salam.

Answer:

Islamic law has declared Bai' Salam permissible. Bai' Salam refers to a sale in which a person in need sells a product or commodity before it is produced or harvested, in exchange for an agreed payment upfront. Upon completion or availability of the product, it is then delivered to the buyer.

This practice is supported by a narration from Sayyiduna Abdullah bin Abbas (RA), who reported:

"When the Messenger of Allah (ﷺ) came to Madinah, he observed that people practiced forward sales for one, two, and three years. So, the Prophet (ﷺ) said: ‘Whoever engages in Salam should do so for a specified amount and weight, with a fixed term.’"
(Sahih al-Bukhari, Kitab al-Salam, Bab al-Salam fi Wazn Ma‘lum, Hadith No. 2240)

Key Points Derived from the Hadith:

  • The Prophet Muhammad (ﷺ) approved of the practice of Bai' Salam, provided that the sale is based on clear terms, including:
    • A specified quantity or weight of the product.
    • A fixed delivery time agreed upon by both parties.
  • The Companions (RA) continued practicing Bai' Salam even after the time of the Prophet (ﷺ), as demonstrated by multiple narrations found in Sahih al-Bukhari.

Conditions for a Valid Bai' Salam:

To ensure that Bai' Salam is conducted according to Shariah, the following conditions must be met:

① The quantity and quality of the goods must be specified clearly.
② The delivery time must be fixed.
③ The goods being sold must not be present at the time of the contract.
④ The price must be paid in full upfront.
⑤ The item should be deliverable and permissible under Shariah.

This contract benefits both the seller, who receives funds in advance, and the buyer, who secures the product at a predetermined price.

Conclusion: Bai' Salam is a Shariah-compliant mode of trade and is allowed with the conditions outlined by the Prophet Muhammad (ﷺ) and practiced by the Companions (RA). It facilitates economic needs while ensuring fairness and transparency in transactions.
 
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