Praise be to Allah.
We praise Allah for having enabled you to repent, and we ask Allah to make your repentance sincere and cause you to regret what you have done and make you resolve never to go back to it.
If the money that a person owes is for something permissible such as buying food or renting a house, then he has to pay the money that he owes to those who are entitled to it. But in your case, because what you did was haram (impermissible), the owner of the nightclub has no right to your wealth, and you should not benefit from the money owed to him either.
Hence you should give this money in charity to other people.
In the answer to question no. 4642, we stated that al-Shaykh Ibn ‘Uthaymeen issued a similar fatwa (verdict) to the one who had his beard shaved – which is haram – and did not pay the barber for shaving his beard.
This is what you should do if it will not result in harm for you. But if they know you and refer your case to the courts and they make you pay them, then pay them, and they will be the ones who are sinning because of taking it from you, and you do not have to give charity if they take it from you.
And Allah knows best.
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