[The Ruling on Returning Lost Property to One Who Describes Its Features]

Answer – and Allah is the One who grants success: There are three views in this matter:
1. That it is not permissible (to return it), even if the presumption of the claimant’s truthfulness is strong. This is the position of the madhhab.
2. That it is permissible to return it based on the identifying mark, but not obligatory; this is the opinion of the majority of the People of the Household (Ahl al-Bayt) and the two groups (i.e. Hanfis ans Shafies).
3. That returning it is obligatory in what is between the finder and Allah the Exalted. This is the madhhab of Mālik and Aḥmad, and it is narrated from al-Hādī and al-Muʾayyad Billāh.
These views are mentioned in Sharḥ al-Azhār.
I say: What appears strongest to me – and Allah knows best – is the third view: that it is obligatory to return it if the presumption of the man’s truthful claim is strong, and the liability of the finder falls away by doing so, as long as his lie does not become evident. If his lie later becomes evident – such as if another man comes and claims it, bringing upright legal proof or something that shows that it is his property – then in this case the finder is liable for it.
If the finder wishes to be safe from liability, he should stipulate upon the man who claims the lost property and describes it that he (the claimant) will bear responsibility if the true owner later appears; or he should state that he will not hand it over to him except by an order from the judge.
We chose the third madhhab for several reasons:
1– That in the Qur’an there are texts from which acting upon circumstantial indications (qarāʾin) is derived; such as His saying the Exalted: “If his shirt is torn from the front, then she has told the truth and he is of the liars; but if his shirt is torn from the back, then she has lied and he is of the truthful…” [Yūsuf:26–27] and His saying the Exalted: “O you who have believed, when the believing women come to you as emigrants, test them. Allah is most knowing as to their faith. And if you know them to be believers, then do not return them to the disbelievers…” [al-Mumtaḥanah:10]
2– What has come in the Sunnah: that the Prophet, May Allah bless him and his family and grant them peace, returned the dīnār which ʿAlī (Peace be Upon Him) had picked up as lost property to the one who was seeking it, and it has not been narrated that he, May Allah bless him and his family and grant them peace, asked the seeker for legal proof (bayyinah).
3– What has been established: that it is obligatory in the dīn of Islam to act upon predominant presumption (al-ẓann al-ghālib).
4– Those who follow the first madhhab – those who say that it is not permissible to return it even if the presumption of the claimant’s truthfulness is strong – are addressed as follows: Legal proof (bayyinah) does not produce anything more than presumption, and yet you have declared that returning (property) based on legal proof is obligatory. So if an identifying description produces the same degree of presumption as legal proof, or even more, then what prevents the obligation of returning it (on that basis)?
If it is said: What prevents that is the existence of (other) possibilities; and there is another impediment, namely that it is not permissible to act based upon presumption in respect of the property of another.
We say: Those possibilities also exist with legal proof, because legal proof too only produces presumption; thus it is not sound to make that an impediment.
And your statement that “it is not permissible to act upon presumption in respect of the property of another” is refuted by the fact that legal proof produces nothing but presumption, and yet acting upon it in another’s property is permissible – rather, obligatory.
If it is said: We only ruled that returning property based on legal proof is obligatory – even though it produces nothing but presumption – because acting upon it regarding wealth is established in the Qur’ān, as in the verse of indebtedness in Sūrat al-Baqarah, and because of consensus on that. No proof has come establishing the obligation of acting upon what you have mentioned in the question.
We say: The fruit of testimony is presumption, and that is the objective of it. Whatever produces the same effect must be given the same ruling.
If it is said: Acting upon testimony is a matter of pure devotional compliance (taʿabbud), and thus it is obligatory to act upon it but not upon what you have mentioned. If it were otherwise, it would be obligatory to act upon the testimony of a fāsiq (openly sinful person) whenever it produced presumption; for this reason we said that it is not permissible to act upon circumstantial indications even if they produce predominant presumption.
We say: Acting upon testimony is rationally comprehensible in meaning. The reason why acting upon the testimony of two upright witnesses is obligatory is precisely because it produces presumption in the Sharīʿah. The testimony of the openly sinful was rejected because it does not produce presumption in the Sharīʿah. Allah the Exalted, Who is All-Knowing and All-Wise, has said: “O you who have believed, if there comes to you a fāsiq with information, investigate, lest you harm a people out of ignorance and become, over what you have done, regretful.” [al-Ḥujurāt:6] Thus, Allah the Exalted has described the content of the fāsiq’s report as “ignorance” which is followed by regret. The report of a fāsiq does not, in reality, produce presumption; rather, as Allah the Exalted has informed, it produces ignorance and yields regret. From what we have mentioned, it is established that acting upon the testimony of two upright witnesses is obligatory precisely because it produces presumption.

Source: Min Thimār al-ʿIlm wa al-Ḥikmah vol.2