Rental Based On Percentage Of Turnover

1)    In a lease agreement, it is necessary that the rent be fixed. If the rent is not fixed but fluctuates, it will not be permissible. Therefore, the scenario mentioned in the query is not permissible, since the rent is not fixed as the turnover will be different for each month. 

2)    Even though this transaction will not lead to a dispute, it will be impermissible. The reason is that there are many examples of business transactions where despite the element of dispute being cast aside by a clause in the contract, Shari’ah has ruled it as impermissible. Therefore, apart from the transaction not leading to a dispute, one needs to see whether such a transaction is intrinsically acceptable in Shari’ah or not. 

It is clear that this condition is unfair to the lessee. Although the lessee agrees and accepts the conditions because he is in need of the premises, he will burn from within when he has to pay more based on the increase in turnover; whereas, if he suffers losses for the month, the base rental remains uncompromisable. In many cases, he will even try to conceal his true turnover from the lessor so that he may be able to escape his unfairness. This encourages him to lie. Accepting the condition and agreeing to pay does not mean that he is happy with the condition, as we find that the one who takes an interest-bearing load from the bank in desperation accepts the condition of interest and agrees to pay, yet he is not happy.  

In conclusion, attaching this type of condition and not fixing the rental only tempts and encourages people towards dishonesty by lying and concealing their true business figures.