Carrying Business of Service

The second example given above for diminishing musharakah is the joint purchase of a taxi run for earning income by using it as a hired vehicle. This arrangement consists of the following ingredients:

i) Creating joint ownership in a taxi in the form of Shirkah al-Milk. As already stated this is allowed in Shariah.

ii) Musharakah in the income generated through the services of taxi. It is also allowed as mentioned earlier in this chapter.

iii) Purchase of different units of the share of the financier by the client. This is again subject to the conditions already detailed in the case of House financing. However, there is a slight difference between House financing and the arrangement suggested in this second example. The taxi, when used as a hired vehicle, normally depreciates in value over time, therefore, depreciation in the value of taxi must be kept in mind while determining the price of different units of the share of the financier.

Source: Republished with the kind permission of Sheikh Muhammad Taqi Usmani.