Q 1: Traders in precious stones and diamonds in
conduct their trading business as follows: someone provides excavation equipments for workers and undertakes the living costs during the period of excavation. If, during the excavation period, workers happen to find diamonds, that same person buys the diamond from them and they are not allowed to sell it to anyone else. The expenses he undertakes is cut off from the total value of the diamond. Everything is arranged according to a pre-conditioned agreement between the financer and the workers. If no diamond is found, the person will have no right to demand the expenses he undertakes. What is the ruling of the Islamic Shari`ah on such business?
This kind of business is prohibited as it involves lending a loan with a conditioned benefit (Part No. 13; Page No. 499) and selling at an unknown price.
The right thing is that the person should hire the workers for excavation. In case they find diamonds, it will come into his possession and they will not be entitled to any of it. In case no diamond is found, he can demand nothing from them, but they will be entitled to receive their wages.
May Allah grant us success. May peace and blessings be upon our Prophet Muhammad, his family, and Companions.