What Is Delivery Challan?

A delivery challan is a document created by a seller when goods of any kind are delivered through shipment. Such a delivery needn't necessarily amount to a sale. For example, if there is a transfer of goods that takes place between a head office and a branch office, it does not result in a sale but still requires the issue of a delivery challan.

There are two main types of delivery challans:

• Outward Delivery Challan

• Inward Delivery Challan

An outward delivery challan is a formal document that informs the relevant sales authority about all known details of goods that have been transported. The primary use of an outward delivery challan is for job work and other subcontracting purposes and is sometimes sent along with an invoice.

An inward delivery challan is a document created to keep a track of all the materials that have been sent and received for a particular job. This includes raw materials too.

Delivery Challan Formats - Free Download

Available Formats:

• Microsoft Excel

• Microsoft Word

• Adobe PDF

• Google Sheets

• Google Doc

GST Delivery Challan Format

There are various types of tools you can use to create a GST delivery challan format. A few such tools are:

• Microsoft Word

• Microsoft Excel

• PDF

• Google Docs

• Google Sheets

• Computerized Software

All you need to do is open up the tool of your choice and fill in all the relevant information such as business name, goods description, client info, challan date and number, the overall cost, and contact details and take a printout of the document if needed.

When Delivery Challan Is Issued?

Section 55 (1) of the CGST laws states that a supplier may issue a delivery challan instead of an invoice in the following scenarios:

• When the quantity is unknown during the supply of liquid gas.

• If goods are transported before they are supplied. For example, moving goods between warehouses.

• When goods are transported for job work, and if:

In certain cases, you also need to issue a delivery challan for the transportation of goods. Those cases are:

Transportation based on approval

You require a challan if you are moving goods inter/intra-state for a sale or return and they are removed before the supply happens.

Transportation of art to galleries

You can only transport art to galleries for exhibitions with such challans.

Transportation of goods overseas for promotion and/or exhibition

As per the CBIC Circular No. 108/27/2019-GST issued on 18th July 2019, the transportation of such goods can no longer be treated as supply or export.

Transportation of goods across multiple shipments

If goods are being transported by different modes of transport, the supplier needs to issue a tax invoice for the first consignment and a delivery challan for each subsequent consignment.

At the time of removal of goods

As per Rule 55(4) of CGST and SGST Rules, 2017, a tax invoice can't be issued until after the goods are transported. Therefore, a supplier may issue a delivery challan during the removal of goods and transport them.

When an e-way bill isn't required

As per Rule 55A of the CGST Rules, if an e-way bill isn't required to transport the goods, the goods can be transported using a delivery challan.

Contents of Delivery Challan Format

A standard GST delivery challan format contains the following:

• Contact details: The name and address of both the consignor and consignee.

• GSTIN details: Both their GSTIN details must be clearly stated in the delivery challan.

• Challan date and number: The date of the issue along with the delivery challan number.

• The item description and HSN Code: The Harmonized System of Nomenclature (HSN) along with item descriptions.

• Quantity: The number of goods and the unit of measurement.

• Tax rates and taxable value: Both the tax rates, the taxable value, and the total of all applicable taxes.

• Price and quantity: The total price along with the total quantity.

• Place of supply: In case goods are crossing state lines, mention the place of supply.

• Signature of the supplier: Your delivery challan must have the signature of the supplier.

FAQs on Delivery Challan Format

What is the difference between a delivery challan and an invoice?

The difference between a simple delivery challan format and an invoice is that an invoice proves the legal ownership of goods and services, which includes all the risks and liabilities associated with it. A delivery challan proves that a customer has acknowledged the receipt of goods. It does not show any legal responsibilities or ownership.

When is the delivery challan issued?

A delivery challan under GST is issued by a seller to the buyer at the time of delivery of goods.

Is delivery challan mandatory under GST?

Yes, a delivery challan is mandatory under GST.