All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad is His slave and Messenger.
The aforementioned Hadeeth has an authentic chain of narrators and it was judged as authentic by a group of scholars. We have refuted the misconception mentioned by the dear questioner, quoting some Christians in a previous Fatwa that was posted in the Arabic section of the website. We mentioned that this Hadeeth was misused by some haters to attack the Prophet, sallallahu ‘alayhi wa sallam. Some Muslims were deceived by some of their intrigues and misconceptions, and their hearts were overwhelmed by doubts. These non-Muslims were ruined because of their corrupt nature. They do not find any problem when a man embraces a non-Mahram woman in the middle of the street and kisses her on the mouth wherever he wants with the passers-by indifferently looking at them and finding no problem in that! Meanwhile, if a Muslim father kisses his son out of mercy and compassion, they will suspect him and give a disgraceful misinterpretation of this Hadeeth because every person’s view of others is informed by his own nature.
In fact, the Hadeeth highlights one of the virtues of the Prophet as it states that he used to kiss and embrace his grandson Al-Hasan and play with him. The Prophet lost his two sons Al-Qasim and Ibraheem in their childhood, and Allah, The Exalted, endowed him with his two grandsons Al-Hasan and Al-Husayn. He dearly loved them and used to smell and embrace them often as narrated in Sunan At-Tirmithi. He used to supplicate: “O Allah, I love them, so love them.” [Al-Bukhari]
Any person endowed with a sound human nature would understand nothing different from this Hadeeth. How could a grandfather kiss his young grandson with lust! Assuming that he did, Allah forbids, why would he do so in the presence of the Companions, while Mu‘awiyah and others were witnessing it?
Allah knows best.