Question :

I`m in the gold business. We receive 17,5Karat gold from the gold workshop, and sell it to customers as 18Karat. However, we buy it from them as 17,5K because the workshop takes it from us on that basis. What is the ruling of Sharia on this?

The Answer :

All perfect praise be to Allah, The Lord of The Worlds, and may His peace and blessings be upon our Prophet Mohammad and upon all his family and companions. Basically, sales and transactions should be conducted as agreed by both parties of the contract and after making everything clear to each other, since Allah, The Almighty, says in this regard: "O ye who believe! Eat not up your property among yourselves in vanities: But let there be amongst you Traffic and trade by mutual good-will: Nor kill (or destroy) yourselves: for verily God hath been to you Most Merciful!"{An`nisa`/29}. Therefore, non-adherence to the aforementioned manner of dealing is eating up people`s property in vanities. Islam has forbidden cheating and concealing in sales. The Prophet(PBUH) said: "'Whoever cheats, he is not one of us'"{Muslim}. In conclusion, gold should be sold as agreed by the buyer and the seller without any act of concealing or cheating. Moreover, it isn`t permissible to sell 17,5K gold as 18K; rather, the actual karat should be made clear upon buying and selling. "The Messenger of Allah said: " 'The two parties to a transaction have the choice so long as they have not separated. If they are honest and open, their transaction will be blessed, but if they tell lies and conceal anything, the blessing of their transaction will be lost."{Sunan An`nsai}. And Allah knows best.