It is not permissible for the one who offers the sacrifice to sell the skin of his sacrificial animal, because it has been singled out for Allaah in all its parts, and that which has been singled out for Allaah is not permissible for anyone to make money from it. Hence the butcher should not be given any of it by way of payment.
Al-Bukhaari (1717) and Muslim (1317) narrated that Ali (may Allaah be pleased with him) said: The Messenger of Allaah (peace and blessings of Allaah be upon him) commanded me to take care of his sacrificial animals, and to give their meat, skins and blankets in charity, and not to give the butcher any of it. He said: We will pay him ourselves.
It says in Zaad al-Mustaqni': Its skin should not be sold, or any other part of it, rather it should be made use of.
Shaykh Ibn Uthaymeen (may Allaah have mercy on him) said in his Sharh (7/514): Its skin should not be sold after slaughter, because it has been singled out for Allaah in all its parts, and that which has been singled out for Allaah is not permissible for anyone to make money from it. The evidence for that is the hadeeth of Umar ibn al-Khattaab which says that he provided someone with a horse to ride in jihad for the sake of Allaah, but the man to whom he gave it neglected the horse and did not take care of it. Umar came and asked the Prophet (peace and blessings of Allaah be upon him) for permission to buy it because he thought that its owner would sell it cheaply, but the Prophet (peace and blessings of Allaah be upon him) said to him: Do not buy it even if he gives it to you for a dirham. The reason for that is that it was given for the sake of Allaah, and whatever a person gives for the sake of Allaah, it is not permissible for him to take it back. Hence it not permissible for the one who has migrated from a land of shirk to go back and live there, because he left a land that he loves for the sake of Allaah, so it is not permissible for him to go back to something that he loves if he gave it up for the sake of Allaah. And because the skin is part of the animal like the meat, i.e., it is not permissible to sell it, just as it is not permissible to sell its meat.
or any other part of it means that none of its parts may be sold, such as the liver, leg, head, stomach and so on. The reason is the same as that mentioned above. End quote.
Hence it is known that what is prescribed is to make use of the skin or to give it in charity to one who deserves it, such as a poor or needy person. But if the one who offers the sacrifice gives the skin in charity to a poor person, and the poor person sells it, there is no sin on either of them.
Shaykh Muhammad al-Mukhtaar al-Shanqeeti (may Allaah preserve him) said: If there is a company that will buy the skins in the same abattoir, and he gives it to a poor person, and the poor person goes and sells it to this company, there is nothing wrong with that. End quote from Sharh Zaad al-Mustaqni'.
With regard to selling the skins and giving their price in charity, the scholars differed concerning that. Some of them said that it is permissible and this is the view of the Hanafis and was mentioned in one report from Imam Ahmad (may Allaah have mercy on him), but the majority did not permit it.
It says in Tabyeen al-Haqaa'iq (6/9): If he sells it for a few dirhams to give them in charity, it is permissible, because it is an act of worship like giving the skin and meat in charity.
Ibn al-Qayyim (may Allaah have mercy on him) said in Tuhfat al-Mawdood bi Ahkaam al-Mawlood p. 89: Abu Abd-Allaah ibn Hamdaan said in al-Ri'aayah: It is permissible to sell its skin and offal and head, and give the price in charity. This was stated by Imam Ahmad.
Al-Khallaal said: Abd al-Malik ibn Abd al-Hameed told me that Abu Abd-Allaah (i.e., Imam Ahmad) said: Ibn Umar sold the skin of a cow and gave its price in charity.
Ishaaq ibn Mansoor said: I said to Abu Abd-Allaah: What should be done with the skin of the sacrificial animals? He said: It should be made use of and its price given in charity. I said: Can it be sold and its price given in charity? He said: Yes, (because of) the hadeeth of Ibn Umar. End quote.
See also al-Insaaf (4/93).
Al-Shawkaani (may Allaah have mercy on him) said in Nayl al-Awtaar (5/153): They were unanimously agreed that its meat may not be sold, and the same applies to the skin. But al-Awzaa'i, Ahmad, Ishaaq and Abu Thawr regarded it as permissible, and this is also the view of the Shaafa'is who said: It should be disposed of as the udhiyah itself is disposed of. End quote.
Based on this, there is nothing wrong with giving the skins to the charitable organizations who will sell them and give their price in charity. This is a charitable project, because most people do not make use of the skins of the sacrificial animals, so selling the skins and giving the price in charity is achieving the intended purpose, which is to benefit the poor and avoid the haraam thing, which is offering compensation to the one who offered the sacrifice for any part of his udhiyah.
It should noted that the udhiyah may be given to the rich as a gift, so if the one who offers the sacrifice intends that he is giving the skin as a gift to the charitable organization which is collecting them, there is nothing wrong with that. Then the charity may sell them and give the price in charity however it wishes.
And Allaah knows best.
Reproduced from Islam QA