What is the ruling on the penalty clause when a contract for the sale of a shop is terminated after the buyer has paid the first installment? Should this installment be returned to the buyer, or does it become the right of the seller?

If a sale is concluded with its conditions and pillars fulfilled, it becomes binding on both parties, and neither party may unilaterally revoke it except through iqalah (mutual agreement to cancel). A penalty clause for rescission is not permissible, nor is it permissible to stipulate compensation for the cancellation of a sales contract.

If the buyer wishes to withdraw from the sale and requests iqalah, the seller may refuse to take back the item except at a price lower than what it was sold for. This lower price could be equal to the value of the down payment, or more, or less, taking into consideration the jurisprudential difference of opinion regarding whether iqalah constitutes a rescission or a new sale.