ANSWER:

If Allah admitted people to hell fire based on His knowledge, people would complain that if we were given the chance, we would not have sinned or disobeyed Allah. 

This is why Allah created them and gave them free will to choose and then holds them accountable for their choices. 

QUESTION: If Allah knows everything what’s going to happen and sees everything, created everything and controls everything, then why does He give us the free will to choose and then let us suffer or get rewards accordingly? If He knew everything beforehand who’s going to do what, then what’s the point of all these life and hereafter? What does Allah gain from it? And why did He create it in the first place?