What is the ruling on the Zakat that a grandfather gave to his daughter and her children (a university student and an employee), knowing that they are not poor, and should the money be returned to the grandfather or given to the poor if the Zakat is not permissible?

Zakat is not permissible for the asker, because he is not among its rightful recipients. Even if he were poor, it is not permissible for his grandfather to give him Zakat, as his maintenance is obligatory upon the grandfather. Whoever takes Zakat when he is not among its rightful recipients must return it.

However, if the asker knows that his grandfather will give him the money even if he knows it is not from Zakat funds, then it is hoped that there is latitude in not obligating him to return the money, based on the opinion of the Shafi’is. In any case, the grandfather’s obligation of Zakat has not been discharged as long as the asker is not among its rightful recipients, and the grandfather must be informed so that he can disburse it properly.