Repaying a debt with unlawful wealth

Question

Question: Zayd trades in wine and runs this business; all the money, goods and belongings he has are from the income of this trade. Now, by divine enablement (tawfiq), having repented of this deed, he wishes to separate himself from it, but the difficulty is how he will make a living. So he wishes to know: if he takes an interest-free loan from someone and starts some other business by which his family is supported, and repays the loan with the money from this wine trade, will that be correct?

Answer

When someone usurps the wealth of various people and mixes it, then according to Imam Abu Hanifa ﵀ he becomes its owner because of the mixing, and compensation (daman) will be obligatory. Therefore there is scope to repay the loan with this wealth as well; however, paying compensation for that amount, as written in “Imdad al-Fatawa”, is obligatory.

Source: Fatawa Mahmudiyya

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