Forfeiture of earnest money when the sale is not completed

Question

Question: I wished to sell a house of mine, and there were several buyers for it. Finally one gentleman agreed the sale transaction with me for twenty-five thousand five hundred rupees and paid the sum of four thousand five hundred rupees as earnest money, and asked for a respite of six months to raise the remaining price.

Answer

Returning this money is wajib. The agreement made earlier — that if the deed of sale is not executed this amount will be forfeited — is contrary to the Sharia; abiding by it is not binding, and it is necessary to break it.

Source: Fatawa Mahmudiyya

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