Is it permissible to sell and buy a house by agreeing to pay its value in gold after the buyer delays payment, and what is the ruling on the penalty clause in a contract for buying and selling land?

If the buyer delays in paying the price and agrees with the seller to pay the amount in gold, there are two scenarios:

1. Immediate payment in gold: This is permissible if the gold is at or below the price of the day of payment. This is considered an exchange between "gold" and the "pounds" owed, provided that possession is taken in the same session. It is not permissible to take more than the price of the day of payment.

2. Deferred payment in gold: This is forbidden because it is a deferred exchange. The exchange of currencies for gold requires immediate possession in the same session, as the Prophet (peace be upon him) said: "Gold for gold, silver for silver... hand to hand." Currencies have the same rulings as gold and silver.

The price remains a debt owed by the buyer in the original currency. To safeguard the seller's right, he may rescind the contract, reclaim the goods, and refund any installments paid, especially if the buyer is a defaulter.

Penalty Clause (Sharṭ Jazā’ī): This is permissible in financial contracts except for those where the primary obligation is a debt. It is not permissible to stipulate an increase on a debt for delayed payment, as this constitutes usury (riba). However, in cases other than debt, such as rescinding a contract or a contractor's delay, a penalty clause is permissible.