In Islam, it is haram to take dowry from the father-in-law. A man took dowry and started a business with the money taken as dowry, and he later also took a loan from the bank to grow his business; is his whole income haram now?
All perfect praise be to Allah, The Lord of the worlds. I testify that there is none worthy of worship except Allah and that Muhammad, sallallahu ‘alayhi wa sallam, is His slave and Messenger.
We have previously clarified that the dowry system in India, obliging the bride's father to pay the dowry to the groom, does not conform with the Islamic Sharia. Please refer to fatwa 85873. The resolution of the Islamic Fiqh Academy of India in this regard reads, "The Council decided that the prevalent dowry custom is definitely unlawful and has no basis in the Islamic Sharia."
It is also prohibited for the Muslim to take an interest-based loan, except in case of a Sharia-acceptable necessity. If the borrower spends the usurious loan or the dowry in financing a lawful business, then the business and the profits that it yields are lawful, and it is allowable for him to avail himself of them. However, he is obliged to pay back the dowry to his father-in-law and the loan to the bank without the interests, unless he is compelled to pay the interests as well. He must also repent to Allah sincerely for his sin and resolve not to commit it again.
Allah knows best.
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