In this paper, the hybrid ARQ system involving the single error correcting and double error detection (127, 119) cyclic Hamming codes and the SR(selective repeat) ARQ schemes with a finite receiver buffer has been designed and constructed. The system performance has been analyzed and simulated. As a result of the simulation, it has been shown that the transmitter retransmitted those data blocks that were detected in errors especially the request signal errors using two retransmission. The system performance was measured by throughput efficiency due to channel error effects.