Delay of payment, who carries the effect of inflation ? : effect of inflation on long term debts

Fatawa Question

My question is regarding Riba. A very interesting case came to my knowledge I will tell you about that and ask for you guidance " it is about a about a marriage which took place in Karachi in 1984. The man who was arranging for his daughters marriage asked his sister to lend her money for buying gold. The sister took the man to the gold shop and bought gold worth of 22000 Pak. Rs. In 1999 which is 15 years after the sister gave her money for gold the sister asked her brother to return the money. The brother said that he will pay 22000 thousand Rs. As the gold cost 22000 in 1984 but the sister said that I don’t want 22000 but Ii want the same amount of gold which they bought in 1984. Now the problem is that the same amount of gold today cost up to 60000 which is 38000 higher than the original amount, but the sister insists that from 22000 she will get nothing. So the question is that how much the brother should pay to her sister. One very important thing is that at the beginning of the deal there was no contract since the deal was between the brothers and sisters. So how should we deal with this issue

Fatwa

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Publication Date

2002-06-15

Main Subjects

Economics & Business Administration
Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Islamic economics
• Contracts
• Inflation(Finance)
• Debt repayment
• Debts
• Loans
• Islamic Banks

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-724082

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