Avoiding the semblance of riba

Question

Question: Zayd gave a non-Muslim ten thousand rupees as an advance for milk, and before giving the advance it was settled: the non-Muslim promised, “I will give you forty kilos of milk daily”; it was agreed to give the milk at the rate of 150, and he also promised, “If I do not give the milk, then whatever profit the said Zayd would have made by selling the milk, I will keep paying that amount.” Now Khalid takes forty kilos of milk 18 kilometres away and sells it in a town; he is left with ten rupees a day.

Answer

This transaction is not valid according to the Shari‘a; it contains a semblance (shubha) of riba, and it is not permitted.

Source: Fatawa Mahmudiyya

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