I wanted to know
if this is permissible.. 

There's a website
online where you can buy a chicken for R35 and over a period of 56 days you
make a profit of R13.. The company grows the chicken for you and sells it after
56 days.. Is this type of investment permissible?

Answer: 

We are not in favour of the investment in question as the purchaser (who is referred to as the ‘investor’) buys a chicken from the seller on condition that the seller grows the chicken on his behalf and then sells it on his behalf at a profit of R13. Such a sale falls in the category of Bay-e-Faasid (corrupt sale). This is just one particular issue that renders the transaction corrupt. There could be other questionable issues as well (included in the contract); for example that of the R13 profit being fixed and guaranteed to the purchaser/investor. There is a possibility that the chicken is sold at a lesser profit and the investor is given a guarantee of R13 profit. We therefore do not approve of such an investment.

Yes, if the owner of the chickens enters into a partnership with another party whereby both parties purchase the chickens by contributing R17.50 each (for example), and one party then attends to the growing and selling of the chickens, after which the profits (after deducting expenses) are shared on a 50/50 basis, then such a partnership will be acceptable with the proviso that both parties equally contribute towards the growing and maintenance costs of the chickens if the agreement was on a 50/50 basis, and both parties share in profits and losses. Due to one party being a silent party in the above scenario, the working partner could stipulate a higher profit share for his efforts and the silent partner a lower profit share. By enacting such a partnership, the investment opportunity would be Shariah compliant.

And Allah Ta'aala knows best!

ANSWERED BY: Mufti Mohammed Desai

CHECKED AND APPROVED BY:  Mufti Muhammed Saeed Motara Saheb D.B 

Date: 13 Jumadal Ukhra 1440 - English Date: 18 February 2019