A Diminishing Musharakah contract

:‫بسم هللا الرمان الرحيم‬

In the name of Allah the most gracious the most merciful.
A diminishing Musharakah contract between Mallam Mohammed Koloue Philippe (A) (ID
card number 109988205), here after called the user and Mallam Ahmed Nzoko (ID card
No: 113943812) (B), Mallam Abubakar Tse (ID card No. 110568708) (C), and a Qard-
hassan fund represented by Mallam Ahmed Nzoko (D). B, C, and D are hereafter called the
investors. The original copy of this contract is the English version.
1) A, B, C, and D have agreed to provide W, X, Y, and Z francs CFA respectively towards the
purchase of a motorbike (BAJAJ BOXER *MD2A18AY9HWB69556*) and (DUZWHB54648)
for the purpose of okada business. That is (A, W) (B, X) (C, Y) and (D, Z).
2) The motorbike is to be used by Mallam Mohammed Koloue here after called the user.
3) The cost of the motorbike is 470k where k stands for thousands. This cost is divided into 47
shares of 10k each,
4) Initially all the shares belong to the investors, who authorise the user to buy their shares at the
maximum rate of three shares per week.
5) The investors agree not to propose or sell their shares to any other party without first
proposing them to the user preferably in writing and allowing him at least one month to try to
purchase them at the rate of Seven shares maximum per week. However if the user can go
above seven shares per week then that is fine. The investors must not push him beyond seven
shares per week unless he agrees without any coercion.
6) If an investor wishes to dump all or part of his shares outside the rotary share purchase
arrangement between investors, he should first propose to the user in writing making a copy of
the request to reach the adviser on the same date as the user. Three months time should be
provided to the user to either purchase these shares which in this case can be more than two,
or provide a buyer who will buy the shares at their initial price. On receipt of the request of the
investor wishing to dump his shares, the adviser will inform the other investors even by phone,
email or SMS. If after three months the user can neither purchase the shares nor provide
buyers, then the dumping investor has a month to sell to the other investors. He can sell to an
unknown outside investor only if none of the above mentioned investors is able or willing to
buy the shares.
7) The adviser is empowered to stop any such sale if he doubts the financial credibility, Islamic
acceptability or moral status of the new financial partner. In that case the adviser will have a
further three months to look for an investor with clean resources. He is free in this case to even
go for crowd funding. In the event of failure to find another investor or crowd funding, the
dumping investor is free to sell his shares to whom he pleases.
8) The expenses incurred are to be shared between the investor and user in the ratio of their
share holdings.
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 9) The user is permitted to proceed with regular expenses (changing engine oil as recommended
by the manufacturer), and minimal expenses (small maintenance of less than or equal to 300
francs CFA (three hundred francs CFA not more than once a day)) In either case the
telephone number of the shop or maintenance garage must be noted in case the adviser or
manager is to request such information. The user may also put telephone air time with the
mobile telephone of his choosing to the tune of 1k (one thousand francs per week). All other
expenses must be with the permission of the investors through their manager.
10) The investors must agree on a manager to work with the user and to be able to talk on their
behalf. It is not permitted for the investors to give instructions to the user directly unless the
share ownership situation is such that only one investor is involved in the business. It is also
recommended that the investors choose an adviser versed in Islamic finance and a manager
able to understand and deal with accounting issues during the operation. For simplicity, the
adviser and the manager could be the same person. It can even be one of the investors
managing the funds for his or her partners.
11) The revenues paid as rent for usage of the motorbike shall be shared in such a way that the
user receives a part proportional to his share holdings plus one fifth of the part which
the investors share holdings merit. The investors thus get four fifth of the rent revenues
which their share holdings merit. This is because the investors are sleeping partners. In
common accord with all investors and the user, an investor manager may also be accorded a
certain fraction of the revenue should the task be considered laborious.
12) Article 11 put in mathematical terms will be as follows. Let Uj be the jth revenue of the user at
the jth transaction. And Rj be the revenue due to rent at the jth transaction at which S1j and S2j
are the share fractions of the user and investors respectively. Then the revenue Uj of the user
will be made up of two parts. U1j from the users share ratio and U2j from 1/5 of the investor’s
revenue, on account of them being sleeping partners. NB: share ratio of X is the number of
shares X owns divided by the total number of shares in the business. It is thus always less
than or equal to one.

13) In the event of more than one investor, then as the user purchases shares, the purchases will
be attributed to the investors in turn in a rotary manner. If any of the investors provided a Qard
Hassan loan (a loan for which he does not expect any returns, his share of the profits should
be shared to all the parties concerned as agreed by all the actors. It could be shared to the
investors or to investors and the user equally, or to investor, user and manager.
14) Besides any eventual share dumping desire by any of the investors, the investors only allow
the purchasing of their shares to a maximum of three shares per week.
15) Should the investors wish for some reason to take back the motorbike and either give to
another user or do something else of their choosing, then one month’s notice must be given to
the user, and the total value of his shares as well as his share of the revenue must be given to
him on the day of the motorbike retrieval. If any unconventional method is used to retrieve the
motorbike such as brut force, then the user is to undertake legal procedures to have his
due paid to him.
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 16) Any Qard hasan dept shall be given priority in the attribution of share purchases in order to
return the money of the investor not seeking profit first before the others.
17) The weekly rental cost of the motorbike shall be twenty thousand francs CFA (20k) payable
on the same day of the week every week. Should the user choose to pay by any of the mobile
money payment systems, the cost of retrieving the cash shall be borne by the user.
18) Any amounts earned by the user above the rental shall belong to the user to use as he so
wishes for his upkeep. It is recommended that the user save money for days of low revenue
due to some unforeseen circumstances such as mechanical failure, illness or personal
problems. Should this incapacity to perform be more than three days, then the user should
present an temporal user who would chip in for him for not more than two weeks. If this
incapacity to work is longer than two weeks, then within the third week the investor should take
steps either to put a temporal user of their choosing, or to buy the shares of the user. The
adviser is empowered to stop any new user provided either by the investor or the user with the
condition that he provides an alternative user within one month.
19) All the various revenues should be collected by the manager and given to the various parties
at the end of the contract, which will be when the user has purchased all the shares.
20) Every actor must provide the name and identity card number of a next of kin who will receive
his share of the business in the event of death. In the event of death of the user, the investor
should ask the spouse of the user first for an alternative user before proceeding to propose
other potential users. In that case the next of kin of the user becomes one of the investors with
the shares bequeathed by the user. We must understand that the benefactor of the
bequeathed funds cannot permanently own the funds if he or she is a legal inheritor from the
deceased from an Islamic perspective. In that case he or she must make the funds to migrate
towards the true inheritors with the help of the adviser.
21) Allah (swt) says in the Qur’an that in case of such contracts, we should have a scribe draft it,
and let the transaction be witnessed by two witnesses. Two males or one male and two
females. This is mentioned in surat Baqarat (2) verse 282. The two witnesses shall be named
at the end of the document. Here’s the verse.

It is from surat Baqara, the second surat of the Qur’an. (QS2. Al Baqarah ayat 282)

                

                  

                   

               

                 

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                  

                

                  

[QS2:282 AT]

282. O ye who believe! when ye Deal with Each other, In transactions involving future
obligations In a fixed period of time, reduce them to writing let a scribe write down
faithfully As between the parties: let not the scribe refuse to write: As Allah has taught him,
so let Him write. Let Him who incurs the liability dictate, but let Him fear His Lord Allah, and
not diminish aught of what He owes. if They party liable is mentally deficient, or weak, or
unable Himself to dictate, let His guardian dictate faithfully, and get two witnesses, out of
your own men, and if there are not two men, then a man and two women, such As ye
choose, for witnesses, so that if one of them errs, the other can remind her. The witnesses
should not refuse when They are called on (for evidence). Disdain not to reduce to writing
(your contract) for a future period, whether it be small or big: it is more just In the sight of
Allah, more suitable As evidence, and more convenient to prevent doubts among
yourselves but if it be a transaction which ye carry out on the spot among yourselves,
there is no blame on you if ye reduce it not to writing, but take witness whenever ye make a
commercial contract; and let neither scribe nor witness suffer harm. If ye do (Such harm), it
would be wickedness in you, so fear Allah, for it is god that teaches you. And Allah is well
acquainted with all things.

22) The XAF (i.e. CFA) value of the motorbike is four hundred and seventy thousand XAF or
CFA francs of central Africa. Today the 8th September 2017, the price of gold on the site
longislandcoddelivery.com is $43.14 per gram. This is equivalent to XAF 23,450.67. That is
twenty three thousand four hundred and fifty point six seven francs XAF. In case of
devaluation or change of money nomenclature over any territory including the areas where the
motorbike operates, the remaining shares will be revalued as well as the rent using the value
of the motorbike in gold here shown. The currency conversion was done at xe.com. The value
of the motorbike in grams of gold is given by the XAF value of the motorbike divided by the
XAF value of a gram of gold on the day the contract was signed. Putting in the above figures
we get. Gold value of motorbike =20.04207129 grams of gold. Dividing this by 47, we get
the gold value of the shares to be 0.426427049 grams of gold. Doubling this gives the
weekly rents of the motorbike to be 0.85287846481 grams of gold. It is even advisable to
denominate all amounts in contracts in such a manner because in Islam real money always
has intrinsic value. Allah (swt) mentions a currency in the Qur’an twice. He mentioned the
Islamic dinar in Q3:75 and the Dirham in Q12:20. The Islamic Dinar is a gold coin weighing

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 4.25 grams and the Dirham is a silver coin which weighs 3 grams. In many other places in
the Quran when Allah (swt) talks of riches, He mentions gold.

The various amounts W, X, Y and Z above are as in the table below.

Letter Amount in words figures Remarks

W Zero francs CFA initially. (Mallam Koloue 0.00 He’s a partner because of will.
Mohammed) The user Koloue Mohammed
X Three hundred thousand francs CFA (I.e. by 300k He’s just a rep in the Qard
Mallam Nzoko Ahmed) Hassan fund so cannot profit.
Y One hundred and thousand francs CFA (I.e. by 100k Not on internet. Tel. 677244858
Mallam Abubakar Tse) NB: All docs to him physical.
Z Seventy thousand francs CFA (I.e. Qard 70k Qard Hasan fund by Nzoko
hassan fund represented by Mallam Nzoko
Ahmed)
Total Four hundred and seventy thousand francs 470k There is 11k in safe for start.
CFA
The witnesses are:

Number Name and ID card number Signature

1 Mallam Hama Adam Mamoudou (ID No 110737413)

2 Mallam Ibrahim Oumarou ID receipt No LT 0300215

Other information: The different actors in this deal except the adviser.

Name Role ID card numb Signature

Mallam KOUO NZOKO AHMED 1st Investor (B) 113943812

Mallam ABUBAKAR TSE 2nd investor (C) 110568708

Mallam KOLOUE PHILIPPE User (A) 109988205

Qard hassan fund represented by 3rd Investor 113943812

Mallam Nzoko Ahmed(D)

The contract was drafted and typed by

Sheikh Mohammed Ngubong A Dinar and a
Telephone: +237 78856211 or +237 99917339 Dirham
Email: ngubong_engineering@yahoo.com
Website: www.ngubong-engineering.biz.nf/
Done in Douala, Cameroon. On the 8th September 2017
Allah (swt) has condemned riba in several places in the
Qur’an. Q (2:275-276) Q(3:130). Abu Hureira narrates that
the prophet Mohammed (saw) said « riba has 70 parts and
the smallest is worse than adultery with your mother. m

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