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Profits From A Business In An Undistributed Estate

Question

When a man dies and he has a business. Now two of his sons run the business after his death. He has four sons. After five years, they wish to settle the matter. For the last 5 years, for who is the profit. Only those running the business or all of them? And what happens from now onwards?

Answer

It is a mandatory obligation of the heirs of a deceased person to divide the estate immediately after his demise according to the shares prescribed by Shariah. It is very unfortunate that most of the Muslims do not comply with the rules of Shariah in this regard
nowadays, and their negligence leads to serious disputes and by the passage of time the problems become more complicated.

In the enquired scenario, it was the duty of the two sons to distribute the estate between the legal heirs of their father or at least they should have affected a settlement with them., either by purchasing the shares of the other inheritors in the business, or by effecting a partnership with them, or by getting their permission to continue with the business on specific terms and conditions.

If they had not done so, then it is not permissible for them to continue with the business and to use the capital of the other inheritors for their own benefit. Therefore, all those profits which have accrued against the shares of the other inheritors are not Halaal for them. They can enjoy the profits accruing against their own shares, but they have to surrender all the profits relatable to the shares of the rest of the heirs according to their respective entitlement according to Shariah. In short, the profits of the past five years have to be dispersed to all the heirs (in proportion to their shares) and not only to the two sons who are running the business.

However, it will be advisable for the benefit of both of the parties that they effect a compromise by taking these two brothers as active partners of the business and treating the rest of the heirs as sleeping partners. In this case, an additional proportion of the profit may be allocated to the working partners against their labour, while the rest of the heirs get lesser proportion of the profit as a sleeping partner generally does. 

\Regarding the future (above distributing the current profits), one of the above procedures may be adopted such as purchasing the business from the remainder of the partners or enacting a partnership with them, etc.

 

Checked and Approved By:

Mufti Muhammed Saeed Motara Saheb D.B.

References

 Contemporary Fataawa [pg.173/174]

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