Rāfi‘ ibn Khadīj reported: At the time of the Messenger of Allah (may Allah's peace and blessings be upon him), we used to lease land based on Muhāqalah so that we would lease it in return for one-third or one-quarter of the yield or a specified amount of food. One day, a man from among my paternal uncles came and said: The Messenger of Allah (may Allah's peace and blessings be upon him) has forbidden us from something beneficial for us, but obedience to Allah and His Messenger is more beneficial for us. He has forbidden us to lease land based on Muhāqalah and to lease it in return for one-third or one-quarter of the yield and for a specified amount of food. He commanded the landowner to cultivate it or to give it to someone else to cultivate. He disliked leasing it or anything else. [Another version reads]: We used to lease land based on Muhāqalah, leasing it in return for one-third or one-quarter of the yield..
Commentary :
In the pre-Islamic era of ignorance, there prevailed types of sale that brimmed with oppression and injustice. When Islam came, it established fair sales and forbade whatever involved oppression. Hence, it forbade whatever involved fraud, uncertainty, and ambiguity to end disputes and conflicts among people, which is one of the Shariah-approved objectives.
In this Hadīth, Rāfi‘ ibn Khadīj (may Allah be pleased with him) reports that they used to lease land based on Muhāqalah during the time of the Messenger of Allah (may Allah's peace and blessings be upon him). There are different opinions regarding the meaning of Muhāqalah. It is said: It means leasing the land in return for wheat, as interpreted in some versions, which is called Muhārathah by the cultivators. It is said: It means the cultivation of land in return for a known share of its produce, like one-third, one-fourth, or the like as mentioned in this Hadīth. It is said: It means selling food in its ears in return for wheat grains. It is said: It means selling crops before fully growing. His saying: "And for a specified amount of food," i.e., by taking a specified share of the fruits as a rent for the land, and all this entails ambiguity in the contract between the owner and the lessee. Then, Rāfi '(may Allah be pleased with him) reported that things continued in this way until one day, one of his paternal uncles - it is said: His uncle Zhahīr ibn Rāfi '- came and informed them that the Messenger of Allah (may Allah's peace and blessings be upon him) forbade them from something beneficial for them, referring to Muhāqalah, which was what they obtained in return for using the land so that they would benefit and the worker would benefit as well. However, this benefit, in fact, is a partial benefit, and perhaps it will not be safe from harm, as its fruits might be ruined, which would lead to the loss of the right of one of them. "But obedience to Allah and His Messenger is more beneficial for us," i.e., obeying Allah and His Messenger (may Allah's peace and blessings be upon him) to what he guides us is more beneficial for us than this assumed benefit of Kirā’ and Muzāra‘ah that we used to practice. In fact, responding to the Messenger of Allah (may Allah's peace and blessings be upon him) is better and more beneficial for their religion and worldly life. One of their ways of practicing Muhāqalah was leasing land in return for one-third or one-fourth of its yield or a specified amount of food, i.e., by taking a share of the fruits as a rent for the land. So, the Prophet (may Allah's peace and blessings be upon him) commanded the landowner to cultivate it himself or give it to someone to cultivate. The Prophet (may Allah's peace and blessings be upon him) disliked "leasing it or anything else," i.e., anything related to leasing. It is said: This was during the early days of emigration out of compassion for them; they had either to cultivate it or to let it be cultivated by others from their emigrant brothers. Then, he (may Allah's peace and blessings be upon him) granted a concession for leasing. It was reported that there is no harm in leasing in return for gold, silver, or cash, as in the two Sahīh Collections, Hanzhalah ibn Qays reported: "That he asked Rāfi‘ ibn Khadīj about leasing land, and he said: The Messenger of Allah (may Allah's peace and blessings be upon him) forbade leasing land. He said: I said: Even in return for gold and silver? He said: If it is in return for gold and silver, there is no harm in it." Also in the two Sahīh Collections, Ibn ‘Umar (may Allah be pleased with him and his father) reported: "The Prophet (may Allah's peace and blessings be upon him) agreed with the people of Khaybar to work and cultivate in return for half of the fruits or crops produced." Therefore, it is permissible for the owner to rent it in return for a standard percentage of what is cultivated therein, like one-fourth or one-third of its produce. The prohibition refers to whatever involves risk, ambiguity, and uncertainty. The most famous among such transactions was where the landowner used to specify for himself part of the land and what it produced.
The Hadīth highlights the fact that Allah Almighty and His Messenger (may Allah's peace and blessings be upon him) never forbid benefits and interests; rather, they forbid evil consequences and whatever leads to them..