I have sent my friend a game and he can see that I sent him it, but he is unable to redeem it

Does your friend live in the same country? It's not possible to redeem codes from other countries.

If so request a refund and send your friend the money for example with PayPal.

I have never personally encountered this but I have a friend that did and he never got an answer back from Xbox on what was wrong but he sent it into Xbox and they sent him a new one because he had only had it for a week and they also sent him a new game
because they did find it in the Xbox itself.

Hi Lee, my name is Rodrigo. I'm an Independent Advisor and a member of the Microsoft community and I'd love to assist you today.

I am sorry to hear that.

Go to your order history page https://account.microsoft.com/billing/orders and look for the item.

Select View gift code.

If the code was redeemed, check the name it was sent to.

If the code is still active, select View gift code and then Copy it.

Source: https://support.xbox.com/help/subscriptions-billing/buy-games-apps/gifting-digital-xbox-game-help

No maxen since i had blocked him due to his original Voice message i was unable to decline or accept the friend request. You see he sent two messages one Voice and one friend. I saw the voice first and thats when I blocked him.

But once i created my own request i was then able to unmute him. Then deny the original request....yes i know it convoluted.....

Xbox gifting is region locked, which it would have told your friend before he sent the gift, so there's no way to redeem the code unless you're in Australia also. Your friend would need to see if he can submit a refund request for the purchase.