Nikah with One's Sister's Daughter's Daughter: Lineage of the Children, Inheritance, Mahr and Punishment
Question
The request for a fatwa (istifta') concerns the following matters. (1) Zayd contracted nikah with the daughter of his full sister's daughter, that is, with the daughter of his full niece; two men were witnesses to it, and at the time of the nikah Zayd and his niece's daughter were both adults (baligh). The said Zayd considers nikah with his full sister's daughter's daughter lawful (halal) in the Shari‘a, and even draws an analogy (qiyas)
Answer
(1) This nikah is impermissible. Its impermissibility is explicitly stated in all the base texts (mutun), commentaries (shuruh) and fatwa collections; in no book is it stated to be permissible. (2) Although the nikah is haram, the children born of this nikah will have their lineage established from Zayd (thabit al-nasab).
Source: Fatawa Mahmudiyya
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