Dearth of information on any important fact may make a business deal legally voidable. And the party may find himself badly hit by the misinformation or wrong information and may assert his right to cancel the deal or claim compensation. Islamic scholars use the term jihl for this information lacunae. To be more specific, the experts use the expression “jihl mufdhi ilanniza” (lack of information leading to dispute). The reason behind such qualification of the term is that full information of all intricacies of the subject matter of the business deal in question is neither possible nor desirable. Every piece of information is not the cause of dispute. Hence, absence of relevant and important information that makes a business deal weak and subject to cancellation or leads to claim of compensation is the undesirable jihl. In the modern business parlance this is referred to as the material information. It is incumbent upon the party providing the subject matter of a business deal to pass on all material information.
It is interesting to know that modern economic theories presuppose a dealer in the market, purchaser or buyer to have full knowledge. An economic man is a knowledgeable person who knows the product, its price and other basic information. A seller does not have to inform the buyer about the weaknesses of his product. On the other hand, Islam obliges the seller to inform the buyer about its weakness. Following Prophetic tradition describes this:
Wathila ibn Asqa’ related that the Prophet (may peace and blessings of Allah be to him) said: If anyone sells a defective article without pointing it out, he will come under Allah’s anger. [Recorded in Ibn Ma’ja]
A number of Prophetic traditions may be cited on the topic including the following:
Uqba bin Aamir [may Allah be pleased with him) reported that the Prophet (may peace and blessings of Allah be to him] said: Muslims are each other’s brother. It is not proper for a Muslim to sell any defective product to his brother without pointing out the defect. [Recorded in Sabalus Salam]
Hazrat Wasla (may Allah be pleased with him) reported that the Prophet (peace and blessings of Allah be to him) said: It is not in order for anybody to sell a product without explaining its quality nor is it in order for him to sell that without explaining its drawback. [Recorded in Ibn Ma’ja (number 2246), Hakim (number 8/2), Tabarani (number 317/17)]
PURCHASING OUTSIDE THE MARKETPLACE
Prices are known in market. A deal outside the marketplace done where the seller is not aware of the correct price of the thing in market on a particular day may fall within the category of deal in darkness. Negotiation of the price is permitted but the seller should not be in darkness about the prevailing market condition. If he is misinformed or he is not let to know the market price, the deal may fall in the category of the jihl that the Blessed Prophet has forbidden. Perhaps this was the reason that the Blessed Prophet forbade purchasing of provisions from villagers before they reach the proper market. A number of Prophetic traditions have described this forbiddance.
Abdullah ibn Umar (may Allah be pleased with them) reported that the Prophet (may peace and blessings of Allah be to him) forbade an urbanite to purchase/sell (bai) the product of a villager. [Recorded in Bukhari (number 2159), Nasai (number 206/4)]
Abdullah ibn Abbas (may Allah be pleased with them) reported that the Prophet (may peace and blessings of Allah be to him) forbade an urbanite to purchase/sell (bai) the product of a villager. [Recorded in Bukhari (number 2158)]
The following tradition is more emphatic:
Anas (may Allah be pleased with him) reported that the Prophet (may peace and blessings of Allah be to him) forbade an urbanite to purchase/sell (bai) the product of a villager, even if he be his own brother. [Recorded in Bukhari (number 2161), Ibn Ma’ja (number 2176), Baihaqi (number 346/5]
In all the above forbidding traditions the word bai stands for transaction that encompasses both purchase and sale. If we take it in the meaning of purchase, it would mean that let the villager come to market and know the conditions so that he may sell his provisions in full knowledge. If we take it in the meaning of sale, it would mean becoming agent of the villager for later sale in market. When we say ‘villager’, we mean a person who does not know much and one who is not matured enough to deal with a wise urbanite. Transactions should be in full knowledge and any situation where a person is befooled because of his simpleton nature has to be avoided.
Another set of traditions may be cited in proof of this discouragement of business transactions outside market without letting the seller be aware of the demand and supply position in market and their resulting effect on prices.
Ibn Abbas (may Allah be pleased with him) reported that the Prophet (peace and blessings of Allah be to him) said: do not meet the caravans by approaching them en-route while they are coming with trading goods. [Recorded in Bukhari (number 2158), Muslim (number 1521), Abu Daud (3439), Ibn Ma’ja (number 2177), Ahmad (number 368/1)]
Abu Huraira (may Allah be pleased with him) reported that the Prophet (peace and blessings of Allah be to him) said: Do not contact the caravans bringing food items from outside to the city (market) by going out. If any purchase is made before the arrival of goods in market the seller will have the option (of honouring or rejecting the deal). [Recorded in Muslim (number 1519), Abu Daud (number 3437), Ahmad (number 487/2), Tirmidhi (number 1221), Nas’ai (number 257/7), Ibn Ma’ja (number 2178)]
The guiding principle in all the above mentioned traditions of Prophet Muhammad (peace and blessings of Allah be to him) is that transaction between two or more parties should be above board and blemish-free, leaving no scope for confusion, fraud or distrust. Islam does not presuppose ‘all-knowing-rational economic man’ but it intends to elevate man to that position.