A delivery challan is a document used when goods are transported without an invoice, typically for reasons like job work, sample transfer, or returnable materials. While it is not a substitute for a tax invoice, it is an important document under GST and business logistics.
In this blog, we explain what a delivery challan is, when it should be used, its legal importance under GST, and provide a detailed sample format suitable for business use.
Introduction
In the world of logistics, manufacturing, and trading, not every goods movement happens after a sale. Sometimes materials are sent for processing, samples are sent to clients, or goods are returned for quality issues. In these cases, you do not raise a tax invoice; instead, you issue a delivery challan.
A delivery challan is proof of goods movement and is evidence under Rule 55 of the CGST Rules, 2017. It also has details like description, quantity, purpose of transport, and is signed by both parties. For GST compliance, it is important for businesses to get the format correct and record the delivery challan in sequence, with proper record-keeping.
What is a Delivery Challan?
A delivery challan is the commercial document issued when goods are transported, but no sale has occurred. It accompanies the goods during transit and is presented during inspections or at the point of delivery.
It is most commonly used in cases of –
- Job work or processing
- Samples or promotional items
- Goods sent on an approval basis
- Return or repair of goods
- Transfer between branches or warehouses
- Transportation of liquid gas (where quantity can’t be determined at dispatch)
The delivery challan provides a clear trail of goods movement and is especially important for GST compliance, inventory tracking, and accountability.
When is a Delivery Challan Used Under GST?
According to Rule 55 of the Central GST Rules, a delivery challan is used when –
- Goods are sent without sale
- An invoice cannot be issued at the time of dispatch
- Goods are transported for job work or an exhibition
- Goods are transferred between different branches of the same business
In such cases, the challan must be issued in triplicate –
- Original – It is for the consignee.
- Duplicate – It is for the transporter.
- Triplicate – It is for the consignor’s records.
Essential Contents of a Delivery Challan
A valid delivery challan should include the following details –
- The title “Delivery Challan” is clearly mentioned
- Serial Number (unique for each financial year)
- Date of issue
- Name, address, and GSTIN of the consignor
- Name, address, and GSTIN (if applicable) of the consignee
- Description of goods
- HSN code
- Quantity (and UOM – Unit of Measurement)
- Tax rate and amount, if applicable (in case of a taxable delivery challan)
- Place of supply, if applicable
- Signature of authorised person
While delivery challans can be issued without tax details for non-sale movement, if tax is involved, those elements should be included.
Sample Delivery Challan Format Online
Here is a comprehensive sample format of a delivery challan, suitable for business use –
DELIVERY CHALLAN
Challan No. – DC/2024/078
Date – 18 July 2024
From (Consignor) –
ABC Industries Pvt. Ltd.
123, Industrial Area, Phase II
Mumbai, Maharashtra – 400001
GSTIN – 27AAECA1234M1Z5
To (Consignee) –
XYZ Job Works
Plot No. 22, MIDC Zone
Pune, Maharashtra – 411018
GSTIN – 27AACFY2345R1Z2
| Sr. No. | Description of Goods | HSN Code | Quantity | Unit | Remarks |
| 1 | Mild Steel Sheets | 7208 | 100 | Pieces | Sent for job work |
| 2 | Stainless Steel Components | 7326 | 50 | Pieces | For the machining process |
Total Quantity – 150 Pieces
Mode of Transport – Own Vehicle
Vehicle No. – MH12AB1234
Reason for Transport – Job Work
Place of Supply – Maharashtra
Declaration –
We hereby declare that the above-mentioned goods are not sold but are being sent solely for job work purposes.
Authorized Signatory
ABC Industries Pvt. Ltd.
(Signature with Stamp)
Note- You may add your company’s logo, branding, or specific fields like E-way bill number or transporter details as per your internal system.
Best Practices for Using Delivery Challans
- Always issue sequentially numbered challans
- Maintain soft and hard copies for audit purposes
- Cross-reference challans with inward registers or job work reports
- Mention the purpose of delivery clearly to avoid GST complications
- For inter-state movement, include GSTIN and place of supply accurately
- Ensure a challan is never used in place of an invoice for actual sales
Conclusion
A delivery challan is an important document for businesses whenever goods are transported, but when no sale is involved. It allows a business to better keep control of inventory, it reinforces the compliance of GST regulations for any movement of goods, and it facilitates the proper tracking of the goods movement for any violation of the law. Use the proper format and include all items necessary to avoid penalties for non-compliance and to ensure proper movement of goods in an easy manner.
Whether you are sending goods for job work, transferring between warehouses, or supplying samples, using a well-structured delivery challan is a smart and compliant practice.
Related Services
References
https://selfservice.gstsystem.in
https://www.gst.gov.in/
