First establish that the sample is contractual
Section 17 of the Sale of Goods Act, 1930 applies where an express or implied term makes the transaction a sale by sample. An exhibit or marketing swatch is not necessarily contractual. Identify the accepted sample, its version and the evidence that the parties agreed to use it as a quality benchmark.
Read the applicable text: India Code: Sale of Goods Act, 1930, sections 13, 15, 17, 41, 42, 59 and 62.
Apply three tests to the delivery
Section 17(2) implies that the bulk matches the sample in quality, that the buyer has a reasonable chance to compare the two, and that the goods are free from defects that make them unmerchantable and would not be apparent on reasonable examination of the sample. A matching visual appearance does not establish the absence of a latent defect. Under section 62, implied rights, duties or liabilities may be negatived or varied by express agreement, a course of dealing, or a usage binding both parties. Check the evidence before relying on a variation.
Check the written description as well
Where goods are sold both by sample and description, section 15 requires correspondence with the description as well. Build a test matrix for material, dimensions and performance. Preserve a sealed reference sample, lot markings, comparable tests and the history of any sample substitution. Record whether the alleged defect was discoverable using reasonable examination of the sample at the relevant time.
Keep evidence separate from the remedy decision
Record when the buyer could compare the goods and how the goods were handled before acceptance. Section 41 protects a buyer who has not previously examined the goods until there has been a reasonable opportunity to examine them. Under section 42, acceptance can arise by intimation, conduct inconsistent with the seller’s ownership or retention beyond a reasonable time without rejection. Section 13(1) allows waiver of a condition or an election to treat the breach as a breach of warranty. Section 13(2) generally requires that treatment after acceptance of all or part under a non-severable contract, unless an express or implied contractual term provides otherwise. If the matter is treated as breach of warranty, section 59 permits the buyer to claim diminution or extinction of the price, or sue for damages. A price diminution or extinction does not bar damages for a distinct further loss proved. Test causation and avoid double counting discounts and repair costs.
Six worked illustrations
All facts and amounts are fictional. Calculations illustrate the stated assumptions, not a predetermined legal outcome.
Illustrative example 1: Compare measured bulk to the agreed sample
A contractual reference sample measures 5.00 mm; the bulk mean is 4.75 mm. The difference is 0.25 mm or 5% of the reference. Compare the contract’s tolerances and lot data before concluding breach.
Illustrative example 2: Keep sample and description tests separate
A bulk lot matches a 20 mm sample. The contract description, which also applies, specifies a 22 mm minimum. There is a 2 mm shortfall against the written test even though the sample difference is zero.
Illustrative example 3: Map the suspect lot
A delivery contains 1,200 units; 300 trace to the lot under investigation and 900 to other lots. The suspect lot is 25% of delivered units. Segregate it without assuming the other lots passed or the suspect lot failed.
Illustrative example 4: Quantify a tested sample, not the full population
A laboratory tests 40 units from an identified lot and finds 8 failures. The observed rate is 20%. Do not multiply it across the shipment without an adequate sampling basis.
Illustrative example 5: Isolate the value shortfall
Assume proven values of ₹160,000 as warranted and ₹133,000 as delivered. The difference is ₹27,000, a comparison for the remedy analysis rather than an automatic award.
Illustrative example 6: Avoid repeating an allowance
A supported proposed ₹42,000 reduction includes an earlier ₹12,000 credit for the same shortfall. The incremental claim under discussion is ₹30,000, subject to proof and the agreed or lawful remedy.
Ten-step verification table
| Step | Action | Evidence |
|---|---|---|
| 1 | Establish the controlling contractual terms | Signed purchase order and technical schedules. |
| 2 | Identify the approved sample | Sample ID, seal and supplier acknowledgement. |
| 3 | Map the delivery population | Lot numbers, quantities and intake records. |
| 4 | Verify written specifications independently | Description and tolerances alongside sample tests. |
| 5 | Document comparison access | Delivery timing and actual inspection opportunity. |
| 6 | Investigate any hidden defect | Test report and evidence of discoverability. |
| 7 | Preserve affected goods and samples | Chain of custody and quarantine record. |
| 8 | Assess acceptance and severability | Use, correspondence and contract terms. |
| 9 | Quantify the supported difference | Valuations, credits and documented costs. |
| 10 | Approve and communicate the remedy position | Reasoned decision and dated notice. |
Sixteen practitioner FAQs
1. Does an exhibit make every order a sale by sample?
No. Verify an express or implied contractual term.
2. What is the quality comparison against?
The sample agreed under the contract.
3. What if the delivered lot matches the sample but not the description?
Where both tests apply, section 15 requires compliance with the description as well.
4. Does lack of comparison opportunity matter?
Yes. Section 17 separately implies reasonable opportunity.
5. Does section 17 protect against all hidden flaws?
The specific condition concerns defects making goods unmerchantable that reasonable sample examination would not reveal.
6. Should a cosmetic match end the inquiry?
No. Review relevant quality, description and latent-defect tests.
7. Can a newer supplier sample replace the approved one?
Only use it as the benchmark if the evidence establishes a contractual change.
8. Are laboratory failures proof of failure in every unit?
No. Separate observed results from any justified inference.
9. What if the buyer continued using the goods?
Review whether conduct amounts to acceptance and what remedy remains.
10. Can contract terms change implied obligations?
Examine the conditions for variation under section 62.
11. Can the buyer waive a condition?
Section 13 permits waiver or treating its breach as a warranty breach.
12. Does a warranty breach alone permit rejection?
Section 59 does not permit rejection merely on that basis.
13. Can a price reduction and further damage coexist?
Section 59 contemplates further proved damage; reconcile amounts to avoid duplicate recovery.
14. Who should preserve the sealed sample?
Assign custody by contract or internal control and keep an access record.
15. What supports unmerchantability?
Technical and commercial evidence of the defect’s effect on the goods, not the defect label alone.
16. What is the file’s final output?
A lot-level test record, acceptance chronology and supported remedy assessment.
Official sources
India Code: Sale of Goods Act, 1930, sections 13, 15, 17, 41, 42, 59 and 62