How should one deal with profits received from a Mudarabah contract in which the other party guaranteed the capital, knowing that guaranteeing capital is impermissible? Should these profits be returned to the other party, deducted from the capital, or spent on charitable causes?

Scholars have differed on whether stipulating a guarantee for the capital in a Mudarabah contract invalidates it or not. The more preponderant opinion is that the contract is valid, while the condition itself is invalid. This void condition must be nullified. The profits generated from this contract are permissible, and there is no obligation to spend them on charitable causes.