Question Summary:
I would like to know whether is it permissible to pay this interest to bank using the dividend/return on my investment that I had already received?

Question Detail:

Question on use of Interest received
Assalamua'laikum,
Due to ignorance and limited knowledge of Islamic investment and finance rulings, let say, if I had invested in conventional investment fund/scheme (i.e. possibly riba'-based) and received dividend/return on my investment, I understand that I could not use the return for my own benefits/livings/expenses but must be donated to fakir&poor people,or donating them to build public toilet,etc.
At the same time, I also applied and received conventional loan from bank for payments of house/vehicles/etc., whereby I had to pay some interest to bank for above loan.
I would like to know whether is it permissible to pay this interest to bank using the dividend/return on my investment that I had already received?
I understand that I need to stop investing in such investment, but was just wondering on way to use the return/dividend money that I had already received from this conventional investment.
Jazakallah,
 

Answer :

In the name of Allah, Most Gracious, Most Merciful
Assalaamu `alaykum waRahmatullahi Wabarakatoh
The profits/dividends from a conventional bank is haraam. You should dispose off the haram money to the poor and needy and also make tawba. If you have another conventional loan, you should pay that out as quickly as possible and free yourself from curse of the interest. If you have surplus funds or assets, use that to pay off the loan. Do not use the haraam funds for that. If you do not have have surplus funds or assets to pay the interest loan, then as a last resort you may use the haram profits/dividends from the same bank to pay the interest amount. You should also make lots of Tawba and Istighfaar and never again engage in interest bearing transactions.
And Allah knows best
Wassalam
Mufti Ebrahim Desai
Darul Iftaa, Madrassah In'aamiyyah