2 – The ḥadith can be understood in three ways:
a) Permissibility of executing a Muslim for killing a non-Muslim. This is the view of Imām Abū Ḥanīfah, based on the unrestricted wording of the texts concerning retributive execution (qiṣāṣ) and on the need to preserve security and social order. Putting a Muslim to death for murdering a dhimmī (a non-Muslim under Muslim protection) is an even stronger deterrent than executing him for killing another Muslim, because religious hostility—especially when anger flares—may incite him to murder. Strong deterrence is therefore required, and enforcing qiṣāṣ is more conducive to a safe society, as the Almighty says: “In retribution there is life for you” (Q 2:179). The Egyptian courts have adopted this opinion and make no distinction in penalties on account of religious difference.
The majority of scholars, including the other three imams, do not permit executing a Muslim for killing a non-Muslim under any circumstance, on the grounds that the non-Muslim is not the equal of the Muslim. If, however, a non-Muslim kills a Muslim, he is executed, for that is the killing of the inferior for the superior; this ruling applies equally to dhimmīs.
b) The execution mentioned was a discretionary punishment (taʿzīr), not qiṣāṣ. For that reason the Prophet ﷺ assumed the decision himself and did not leave it to the heirs of the victim.
c) The case involved murder by treachery (ghīlah). Those who hold that ghīlah warrants capital punishment do not require the normal conditions of qiṣāṣ, such as parity between killer and victim. And Allah knows best.
Ibn Taymiyyah said in al-Ikhtiyārāt: “A Muslim is not executed for killing a dhimmī unless the murder was committed by ghīlah.” Elsewhere he wrote: “Pardon is not valid in a case of ghīlah, because it cannot be guarded against—like murder by violent assault.”
Ibn al-Qayyim stated that killing by ghīlah obliges execution of the murderer as a ḥadd penalty; pardon does not cancel it, nor is parity required. This is the position of the scholars of Madinah, one of the two reports from Aḥmad, and the preference of Shaykh Taqī al-Dīn.
3 – The text magnifies the gravity of killing a treaty-bound non-Muslim, for al-Bukhārī narrates from Ibn ʿUmar that the Prophet ﷺ said: “Whoever kills a muʿāhad will not so much as smell the fragrance of Paradise.”