Narrated Aishah: The Prophet ﷺ ordered a horned ram with black legs, black belly and black round the eyes, and it was brought from him to sacrifice. He said: Aishah, get the knife then he said: Sharpen it with a stone. So I did. He took it, then take the ram he placed it on the ground and slaughtered it. He then said: In the name of Allah. O Allah, accept it for Muhammad, Muhammad's family and Muhammad's people. Then he sacrificed it.
Hadith Referenceسنن ابي داود / كتاب الضحايا / 2792
Hadith Gradingالألبانی:حسن | زبیر علی زئی:صحيح مسلم (1967)
Hadith Takhrij« صحیح مسلم/الأضاحي 3 (1967)، (تحفة الأشراف: 17363)، وقد أخرجہ: مسند احمد (6/78) (حسن) »
Benefits and Issues: ➊ The sacrificial animal should be healthy and appear pleasing. If the aforementioned qualities are present, then it is excellent.
➋ The knife should be very sharp.
➌ Offering sacrifice on behalf of the Ummah of Muhammad (sallallahu alayhi wa sallam) was a particular characteristic of the Prophet (sallallahu alayhi wa sallam). Every person should offer sacrifice on his own behalf and on behalf of his family, or on behalf of the one who has made a bequest for it.
➍ From this hadith, evidence has been taken that it is permissible to offer sacrifice on behalf of the deceased, because the Prophet (sallallahu alayhi wa sallam) offered sacrifice on behalf of his Ummah, and among them were those who had already passed away, and there was also a large number who were born after the Prophet’s (sallallahu alayhi wa sallam) passing. However, this inference is not correct, because offering sacrifice on behalf of the Ummah was a particular characteristic of the Noble Prophet (sallallahu alayhi wa sallam), which is not permissible for others to act upon, as has already been clarified (in the benefits of Hadith 2791).
Source: Sunan Abu Dawood – Commentary by Shaykh Umar Farooq Saeedi, Page: 2792