Rejection of non-conforming goods bars later warranty claims when the buyer has not accepted the goods.

A buyer who validly rejects goods that do not answer the contractual description cannot later treat the same goods as accepted and claim damages on a breach of warranty basis. The Madras HC noted that once the non-conforming goods were rejected and the rejection was accepted, title revested in the seller, leaving the buyer to pursue the alternative remedy of damages for non-delivery, not the inconsistent remedy reserved for accepted goods. The court held that remedies under the Sale of Goods Act are mutually exclusive, so a counterclaim framed on rejection and an alleged repurchase agreement could not be shifted in appeal to an acceptance-and-warranty theory. The counterclaim was therefore unsustainable.

---

---

Issues: Whether the appellants, after valid rejection of goods not answering the contractual description, could later treat the goods as accepted and maintain a counterclaim for damages on the footing of breach of warranty; and whether the counterclaim based on the alleged agreement to take back the rejected goods at landed cost was sustainable.

Analysis: The goods supplied were held not to conform to the description because colour of the barrels formed part of the contractual description. Once the buyers validly rejected the non-conforming goods and the seller accepted that rejection, the buyers divested themselves of title and the property revested in the seller. On that footing, the buyers had no right to appropriate the goods as their own and then invoke the remedy available only on acceptance of goods. The remedies under the Sale of Goods Act were held to be alternative and not cumulative: a buyer may reject non-conforming goods and claim damages for non-delivery, or waive the condition and accept the goods and claim damages for breach of warranty. The counterclaim in the written statement proceeded on the former footing of rejection and an independent agreement to repurchase, whereas the argument in appeal rested on the inconsistent footing of acceptance and breach of warranty. The court held that such a shift was not legally permissible and that the sale proceeds of the goods, if any, were in any event not brought into account by the appellants.

Conclusion: The appellants were not entitled to counterclaim damages on the basis of breach of warranty after having validly rejected the goods, and the counterclaim was rightly dismissed.

Final Conclusion: The appeal failed because the buyers could not convert a valid rejection of non-conforming goods into an acceptance so as to claim damages on a warranty theory; the alternative remedies under the Sale of Goods Act excluded the appellants' claim.

Ratio Decidendi: Where a buyer validly rejects goods that do not correspond to the contractual description, the buyer cannot thereafter, without the seller's consent, treat the same goods as accepted and claim damages for breach of warranty, because rejection and acceptance are mutually exclusive remedies under the Sale of Goods Act.

---