Ruling on the increase on a retirement pension

8-12-2014 | IslamWeb

Question:

Mu' meneen Brothers and Sisters, As Salaam Aleikum wa Rahmatullahi wa Barakatuh. (May Allah's Peace, Mercy and Blessings be upon all of you) In the name of Allah, I praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. I bear witness that there is no one (no idol, no person, no grave, no prophet, no imam, no dai, nobody!) worthy of worship but Allah Alone, and I bear witness that Muhammad (saws) is His slave-servant and the seal of His Messengers. My name is Basit Minhas and I am from Pakistan. My question is regarding retirement benefit of my father. I know that riba/usuary is strictly prohibited in islam. My father was an officer in Pakistan Navy. During time of his service he used to deposit money on monthly basis in his retirement fund scheme. After his retirement he got lump sum money than he had originally deposited. When I argued that this is riba/usury he said no it is not riba rather it is retirement benefit and is halal. He said that only naval officer could have availed this scheme. No other person can use this scheme hence it is a benefit only for naval officers and not ria. Please tell me if my father is right or not. Secondly using this lump sum money of his retirement fund my father bought a plot. Then he Built a House on that plot. It should be noted that cost of construction of house was all paid from Halal money. Only plot was bought from retirement fund. I am only Son of My father so naturally I will inherit the house. That house is my future security. I don’t want to sell it. But please tell me if it is built on plot bought from retirement money do I have to sell the house?? This question has been troubling me for very long please answer this question at the earliest.

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Answer:

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His slave and Messenger.

If the extra sum of money that your father received from the retirement pension fund was the result of an unlawful investment, then it is unlawful and it is impermissible for him to use it; rather, he has to dispose of that extra money by spending it on the interests of Muslims or offering it in charity to the poor and destitute. Please refer to Fatwa 90569.

However, if the source of this extra money is not as such, such as if the Navy offers it to pensioners or it is the result of a lawful investment, then there is no harm in utilizing it.

In any case, even if this extra money was unlawful and the plot was bought with the retirement pension, this does not mean that it is impermissible for you to utilize it and you are not obligated to sell it or dispose of it if it eventually falls into your possession.

Allaah Knows best.