Assalaamu alaykum. I have a question about trade. I was introduced to a brother who supplies brand new LCDs and buys broken (refurbishable) LCDs. We came to an agreement which states that I buy broken LCDs for a certain price, for example £15 each, and then I sell it to him (the brother) for a certain price, for example £22 each, making me the £7 difference on each. I did not have enough money to buy the broken LCDs, so he gave me £500 to start me up, with which I buy 33 LCDs at £15 each and then sell to him for £22 each, giving me £726, so then I give back his £500, leaving me £226. Is this halal; borrowing money from him and dealing with him in this way? Also, he gives me brand new LCDs to sell: the agreement is that he gives me the new LCDs for a certain price, for example £15 each, and then I sell them for a certain price, for example £17, making me the £2 difference, so if I get orders from costumers for, let us say, 150 LCDs for £17 each, we agree to the price, and then I go to my supplier (the brother) and take the 150 LCDs without paying him (we agreed that I sell it and then give him his money from the sale), and then I go to my costumers and give them the LCDs and take the money from them. I take my £2 difference from each LCD and give the rest to the brother. Is this halal/haram; taking the products from him without paying him and giving him his money from the sale? I make sure to not take money from costumers until I hand over the LCDs to them, and I make sure that they have the full price with them before handing over the LCDs, but sometimes the costumers need LCDs on credit, meaning that I give some to them and that they are to pay me on a later date, without interest of course. My supplier is the one who suggested to me to give some to them on credit if I can trust them. Is this halal/haram; taking from my supplier without paying him and then giving to my costumers without them paying me on the same day but on a later date? Also, when I take the LCDs from my supplier, do I have to move them to my house, or is it ok to move them down the road, about five minutes away from him?

All perfect praise be to Allah, The Lord of the worlds. I testify that there is none worthy of worship except Allah and that Muhammad is His slave and Messenger.

Your question included three matters which we will answer as follows:

Firstly, the issue of buying used LCDs and selling them to your friend with a profit; there is nothing wrong with it provided that the first thing that happens between the both of you is only a promise of sale and not a sale contract. It is not permissible that the sale contract is concluded between you on LCDs that you do not own; this is Islamically forbidden.

Secondly: The issue of him lending you capital money on condition that you buy the LCDs and sell them to him; this is not permissible because it is a loan that brings about a benefit. He did not lend you money except because he benefits from that, and he conditioned that the loan be spent on the purchase of LCDs which will be sold to him. The book Asna Al-Mataalib, which is one of the books of the Shaafi’i School, reads, “Any loan that brings about a benefit is interest; that is to say that the lender stipulated a condition that brings a benefit to himself.”

However, if this was not conditioned, and when you apologized to him that you do not have the capital money and he wanted to help you and lend you the five hundred to benefit from it even if he will also benefit from the purchase of the LCDs, but this was not conditioned in the contract and the benefit is not specific to it, then this is permissible.

Ibn Al-Qayyim said, “If the lender may also benefit from the loan, as in the case of As-Suftajah, and this is why some scholars disliked it, but the correct opinion is that it is not disliked, because the benefit is not specific to the lender; rather, they both benefit from it.”

As-Suftajah is when a man (A) lends money (in a given country) to someone else (B), and the latter (B) has money in the country of the lender; so he gives him back the money there; so he benefits from the safety of the road (i.e. he fears that if he takes the money with him during travel, it may be stolen from him). Please, refer to fatwa 98810.

Thirdly: The issue of selling new LCDs either in cash or on credit; there is nothing wrong in it, because you act as an agent and you are paid for this, as you mentioned. So you sell the LCDs on behalf of their owner and he gives you a fee in return for that, which is that you sell an LCD for a given amount, and whatever exceeds that amount is for you. It is not a condition here to own the LCDs because you do not sell them for yourself, but you sell them on behalf of their owner, so you are only an agent for him.

There are other probabilities, and we cannot deal with them all here in this fatwa, so if the asker meant something other than what was mentioned, he should clarify it so that we would answer it.

Allah knows best.