Is it permissible to deduct the amount of the debt that the brother did not repay from the remaining amount due to him as the price of the car, knowing that the amount of the debt is greater than the remaining amount?
Compulsory offsetting is permissible according to the majority of scholars, with conditions: that the debtor owes his creditor the same type, quality, and due date of debt that the creditor owes him. In this case, offsetting occurs between them, and the two debts are cancelled if they are equal, or a similar amount is cancelled from both debts if they differ. These conditions are: the convergence of the two rights, the similarity of the two debts in type, kind, and characteristic with regard to immediate payment and deferment, and quality (goodness or badness), the absence of harm, and that it does not result in a forbidden شرعي (legally impermissible) act. If these conditions are met, then offsetting occurs by itself, even if the other party does not agree.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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