Selling goods on instalments at an unknown price is not valid

Question

Question: We have opened a shop selling watches on instalments, in which a hundred participants have been fixed, and each participant deposits two rupees daily. The price of this watch is 180 rupees, whether he buys it on instalments or pays the price at once. We have fixed the term at three months, during which we are sure to collect two rupees from him every day. After the fifteenth day we hold a draw, and whoever’s name comes out is given the watch, and no further money is taken from that person.

Answer

This arrangement is a kind of qimar (gambling), and the price of the watch is unknown: it is not known what the price of anyone’s watch will turn out to be. Therefore, according to the Shari‘a, this transaction is not valid.

Source: Fatawa Mahmudiyya

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