My understanding is that is is the sellers responsibilty until you have the item in your hand, and even then you can return it 14 days for a full refund under the distance selling rules or such..
If the item has gone astray it is the sellers problem to chase it up with royal mail and to issue a replacement, should the Item Turn up I would hope that the Buyer would be honest and either return it or maybe agree to buy it depending on the item.
Can a consumer cancel an order before they receive the
goods or where goods are lost in transit?
3.35 Yes. Where the DSRs give consumers rights to cancel, this right is
unconditional. If consumers cancel before they have received the
goods you must refund the total price of the goods, including any
delivery charges. Consumers who have cancelled under the DSRs
may refuse to accept delivery of the goods. Refusal in such a
situation cannot be treated as a breach of contract.
3.36 Where goods are lost in transit from you to the consumer you will
need to either send new goods or offer the consumer a full refund,
including delivery charges. See paragraph 3.20 for more information.
Instances where cancellation rights do not apply
(Regulation 13)
Can consumers cancel an order in any circumstances?
3.37 No. The cancellation provisions do not apply to contracts referred to
at paragraph 2.20. There are also statutory time limits for consumers
to exercise their rights to cancel, as explained at paragraph 3.22.
3.38 Unless you have agreed that they can, your consumers cannot cancel
if the order is for:
n services where you have had the consumer’s agreement to start
the service before the end of the usual cancellation period and you
have provided the consumer with the required written information
before you start the service, including information that the
cancellation rights will end as soon as you start the service
n goods or services where the price depends on fluctuations in the
financial markets
http://www.oft.gov.uk/shared_oft/business_leaflets/general/oft698.pdf