AlBaqir:
THE BASICS OF THE QUR'AN
Where is Allah? In the heaven, on the throne or He is everywhere?Literally both school seem to be correct in their justification as supported by verses of the Qur'an.

However, according to the Quran surah Al-Imran: 7, there are two basic verses in the Qur'an: One is Muhkamat (clear) verses, and the other is Mutashabihat (allegorical) verses. The "clear verses" according to the Quran, are the foundation of the Quran which the "allegorical verses" are built upon.

There is no doubt, some of the verses that talk about "Allah sits on the throne", "The chair of Allah encompasses the heavens and the earth{ayat qursiyy}", "hands and face of Allah", etc are all allegorical verses and interpreting them literally will give a false meaning to these glorious verses.
If we however interpret under the guidance of the "clear verses" which are the foundation of the Quran upon which "allegorical" should be based on, one gets a true meaning of those ayah.

ALLAH IS NOT LIKEN TO ANYTHING
The fact that human is composed of matter, it is natural that we look and interpret everything on material level. This include our view on God.
Quran however cautions: [color=#990000]Glory be to your Lord, Lord of majesty; far above what is ascribe unto Him.
There is NONE comparable unto Him.

If it is interpreted that Allah really sits on the throne, philosophically, we have liken Him to a body which is confined in a particular space. Meaning He depend on something.
If we interpreted the "hands, face" of God mention in the Quran as literal, it simply means He is a body with shape and volume.

He is the Creator (al-khaliq)
He is Allah the Creator...{Quran, ch.59:24}.
Another ayah says He creates everything (khaliqu kulli shay'in).
The implication is that He creates "space" (where He is being said to occupy), "Arsh - throne" and "Kur'si - chair" (where it is interpreted to have seated on). All these are His creation.

He is "as-Samad"
Say: He is Allah, the One. Allah is He on whom ALL DEPEND {surah Ikhlas: 1-2}.
Therefore, He can never depend on "space, throne or chair". So Allah sits on the throne, or His chair encompasses the heavens and the earth can never be interpreted literally as it is against the foundational verses of the Qur'an.

Meaning of "ABOVE" or "HIGH"
"...what they call upon besides Him is falsehood; Allah is the High, the Great {Quran22:61}
The first group of Muslims in this discourse believe Allah being "Al-Aliyy" (Above or High) simply means He is "above His creation" as in high (height) in the heavens above His creation who are below.
However, the word "Al-Aliyy" is derived from "uluww", height, sublimity, or loftiness versus lowliness. The height refer to here is that of status. Al-Aliyy us High, so High that He can never be conceived or visualized. Minds are at a loss regarding His greatness; intellects are incapable of conceiving His perfection.

According to Al-Mufradat, one who is "Aliyy" is a prominent person, a man of distinction. When applied to the Almighty, as in Q.22:61 cited above, the implied meaning is that He is above being described by anyone or truly known by anyone. Quran says: "He is the Most High, the Great"{Q.2:255}; "...judgement belongs to Allah, the High, the Great" {Q.13:9}.
Allah is Great that even the "Asmaul husna (beautiful names)" in which He introduced Himself with in the Quran do not do justice to His Greatness.