Section 59 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 59 says what a buyer can do when there is a breach of warranty by the seller, or when the buyer elects or is compelled to treat a breach of condition as a breach of warranty. He cannot reject the goods merely for that breach, but he may set up the breach against the price or sue for damages. This article follows the text of the Act consulted (latest amendment shown: Act 28 of 1993); amendments after that should be checked in the official text.
Where there is a breach of warranty by the seller, or the buyer elects or is compelled to treat a breach of condition as a breach of warranty, the buyer is not by reason only of that breach entitled to reject the goods. He may (a) set up the breach against the seller in diminution or extinction of the price, or (b) sue the seller for damages for breach of warranty. Setting up the breach against the price does not prevent a suit for the same breach if he has suffered further damage.
Starting point: what a "warranty" is
Section 59 uses the words "condition" and "warranty" in the sense given in section 12. Section 12(3) defines a warranty as a stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated. See our article on condition and warranty defined. The Act speaks only of "condition" and "warranty"; the wording printed on a product card or a dealer's promise is not a term of the Act, and the section applies only to what is a warranty under section 12. A buyer who wants to put the breach on record can do so by a legal notice.
Section 59(1): two routes in, one set of remedies
"Where there is a breach of warranty by the seller, or where the buyer elects or is compelled to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; but he may—"
The sub-section applies in two situations:
- A breach of warranty by the seller. The breach is of a warranty from the start.
- A breach of condition that the buyer "elects or is compelled" to treat as a breach of warranty. Section 13 explains when this occurs: the buyer may waive the condition or elect to treat the breach as a breach of warranty, and in some cases the buyer is compelled to do so. See our article on when a condition is treated as a warranty.
In both situations the buyer "is not by reason only of such breach of warranty entitled to reject the goods". The words "by reason only" matter: the sub-section rules out rejection on this ground alone. It does not say that rejection is impossible on any other ground that the Act provides, for example a different breach of condition or the rules on the wrong quantity in section 37.
The buyer "may" then take either of two steps:
(a) "set up against the seller the breach of warranty in diminution or extinction of the price". The buyer uses the breach as a defence or set-off against the price the seller claims. "Diminution" is a reduction and "extinction" is a wiping out. The Act does not state how the reduction is measured; the text is silent on the method.
(b) "sue the seller for damages for breach of warranty". The buyer brings his own claim. The measure of damages is not stated. For compensation under the general law of contract, see our article on section 73 of the Indian Contract Act, 1872; section 3 of this Act applies the unrepealed provisions of that Act except where inconsistent with this Act.
Example (our own, not from the Act): Iyer Foods buys a consignment of packaged turmeric from Qureshi Mills under a contract that includes a stipulation, collateral to the main purpose, about the origin of the turmeric. The origin turns out to be different. If that stipulation is a warranty under section 12, then Iyer Foods may not, by reason only of that breach, reject the consignment. When Qureshi Mills claims the price, Iyer Foods may set up the breach in diminution or extinction of the price, or sue Qureshi Mills for damages for breach of warranty.
Section 59(2): a further claim
"The fact that a buyer has set up a breach of warranty in diminution or extinction of the price does not prevent him from suing for the same breach of warranty if he has suffered further damage."
Two conditions: the buyer has already set up the breach against the price; and he "has suffered further damage". If so, he may still sue "for the same breach of warranty". The sub-section does not define "further damage" and states no method for avoiding double recovery; the text is silent on that.
The buyer's choices when a stipulation is breached
| Kind of stipulation (section 12) | Right to reject? | Remedies in section 59 |
|---|---|---|
| Condition, breach not treated as breach of warranty | May be available; see section 12 and section 13 | Section 59 not engaged |
| Condition treated as a warranty (elected or compelled, section 13) | Not "by reason only of such breach" | Set up against price or sue for damages |
| Warranty | Not "by reason only of such breach" | Set up against price or sue for damages |
| After setting up against price | Not relevant | Further suit for the same breach if further damage |
Where section 59 sits among the remedies
See our articles on damages for non-acceptance and non-delivery and on specific performance for the neighbouring Chapter VI remedies. Section 61 saves the right to interest and special damages where the law allows them; see our article on interest and special damages.
The Act contains implied conditions and warranties as to title (section 14), description (section 15), quality or fitness (section 16) and sample (section 17); section 59 is the remedy section for a breach of a warranty among them. See our articles on implied undertakings as to title and on implied conditions as to quality or fitness.
Practical points
Classify the term first, since section 12 decides whether section 59 applies; raise the breach when the price is claimed; and keep the invoice, the defect record and the correspondence, because the Act states no method for the reduction or the damages. The text is silent on any form of notice.
Need help with a defect claim on goods you have bought?
If goods have arrived with a defect that is a breach of warranty rather than of condition, the route is set-off against the price or a claim for damages. We can prepare a legal notice that states the warranty, the breach and the amount, and advise on which remedy fits.
Key takeaways
- On a breach of warranty, or a condition treated as a warranty, the buyer is not by reason only of that breach entitled to reject the goods.
- He may set up the breach against the price in diminution or extinction, or sue for damages for breach of warranty.
- Setting up the breach against the price does not prevent a suit for the same breach if he has suffered further damage.
- The Act states no method of measuring the reduction or the damages.
Read next
- Section 12 of the Sale of Goods Act, 1930: condition and warranty defined
- Section 13 of the Sale of Goods Act, 1930: when a condition is treated as a warranty
- Section 61 of the Sale of Goods Act, 1930: interest and special damages
- Section 74 of the Indian Contract Act, 1872: liquidated damages and penalty
Disclaimer: Based on the consolidated text of the Sale of Goods Act, 1930 consulted on 2 October 2026, whose latest amendment shown is Act 28 of 1993. It explains the words of the statute only; later amendments and the way courts apply these sections should be checked. This article is general information, not legal advice; check the official text before acting.