A furniture maker sends 20 chairs to a polishing karigar in the next town. A hardware wholesaler moves stock from the main godown to a second shop. An electronics dealer sends a faulty inverter back to the service centre. None of these is a sale, yet the goods are on the road and a GST officer may ask what paper they are travelling with. The answer in such cases is usually a delivery challan, and using the right delivery challan format keeps your goods moving without trouble.
This guide explains what a delivery challan is under GST, when you may use one instead of a tax invoice, what it must contain, a sample layout, and common mistakes small businesses make.
What is a delivery challan under GST?
A delivery challan is a document that accompanies goods when they are moved without a tax invoice. It is covered by Rule 55 of the CGST Rules, 2017, which deals with transportation of goods without issue of an invoice. It records what is being sent, from whom, to whom, in what quantity and for what value, but it does not by itself record a sale.
In daily trade you will also hear "challan" used for the delivery slip that goes with a sale, or for the receipt a customer signs. Under GST, the term has a specific meaning, and you should not use a delivery challan to avoid issuing an invoice for a normal sale.
When can you issue a delivery challan?
Under Rule 55, a delivery challan may be issued in place of an invoice when goods are moved for the following purposes:
- Supply of liquid gas where the quantity at the time of removal is not known.
- Job work, such as sending material for cutting, stitching, polishing, plating or assembly and receiving it back.
- Reasons other than by way of supply, for example moving stock between your own godowns in the same state under the same GSTIN, sending goods for repair, or taking samples or goods to an exhibition.
- Other supplies notified by the government.
There is also a special rule for goods sent in batches or lots, or in semi knocked down or completely knocked down condition. In that case, the complete invoice is issued before the first consignment, each consignment travels with its own delivery challan referring to that invoice along with a certified copy of the invoice, and the original invoice goes with the last consignment.
Situations can be tricky, for example sending goods on approval, or transfers between branches in different states (which have their own GST treatment). Check with your CA before deciding which document to use.
Mandatory fields in a delivery challan
Rule 55 lists the details a delivery challan must contain:
- Date and number of the challan. The serial number can be up to 16 characters and may run in one or more series.
- Name, address and GSTIN of the consigner, if registered.
- Name, address and GSTIN or UIN of the consignee, if registered.
- HSN code and description of goods.
- Quantity (provisional, where the exact quantity is not known).
- Taxable value.
- Tax rate and tax amount (CGST, SGST, IGST, UTGST or cess), where the goods are transported for supply to the consignee.
- Place of supply, in case of inter-state movement.
- Signature.
Copies: original, duplicate, triplicate
For movement of goods for supply, the challan is prepared in triplicate:
- Original marked "Original for Consignee".
- Duplicate marked "Duplicate for Transporter".
- Triplicate marked "Triplicate for Consigner".
Many businesses follow the same three-copy practice for all challans because it keeps records clean and matches what job workers and transporters expect.
Sample delivery challan format
Here is a simple format for goods sent to a job worker. The values are only an example.
| Field | Example |
|---|---|
| Challan No. and date | DC/26-27/018, 12-10-2026 |
| Consigner | Sharma Furniture Works, Patna, GSTIN 10XXXXXXXXXXXXX |
| Consignee | Ravi Polish House, Hajipur, GSTIN 10XXXXXXXXXXXXX |
| Purpose | Job work (polishing), goods to be returned |
| Vehicle No. | BR01XX1234 |
| Place of supply | Bihar |
| # | Description | HSN | Qty | Unit | Value (₹) |
|---|---|---|---|---|---|
| 1 | Wooden dining chair, unpolished | 9401 | 20 | Pcs | 36,000 |
| 2 | Wooden centre table, unpolished | 9403 | 2 | Pcs | 9,000 |
| Total value | 45,000 |
Finish with a line such as "Goods sent for job work and not for sale", the receiver's signature with date, and your authorised signature. Make sure HSN codes match your products; you can check them on this GST rates and HSN page.
Delivery challan and e-way bill
A delivery challan does not replace an e-way bill. When goods move under a challan, the e-way bill rules (Rule 138) still apply. If the value and type of movement require an e-way bill, generate it using the challan details. For job work sent to another state, an e-way bill may be required even for lower values. Thresholds and exceptions vary, so confirm with your CA or on the e-way bill portal before dispatch.
Delivery challan vs tax invoice
| Point | Delivery challan | Tax invoice |
|---|---|---|
| Purpose | Moving goods without a sale, or before the invoice in specified cases | Recording a taxable sale |
| Rule | Rule 55, CGST Rules | Section 31 of CGST Act and Rule 46 |
| GST payment | Does not by itself create tax liability | Tax is charged and reported |
| Buyer's ITC | Not available on a challan | Available to registered buyer, subject to rules |
Checklist before goods leave your shop
- Is this movement really not a sale? If it is a sale, issue a tax invoice.
- Is the purpose written clearly on the challan?
- Are HSN, quantity and value filled in for every item?
- Are three copies ready and marked correctly?
- Is an e-way bill needed for this movement?
- Do you have a register to track job-work goods sent and received back?
How MaterialBill helps with the rest of your billing
Delivery challans are only one part of the paperwork. Most of your day is spent on sales bills, stock and collections, and that is where the MaterialBill billing app helps:
- GST invoices with CGST, SGST and IGST calculated automatically, plus bills of supply for composition dealers.
- Real-time stock with low-stock alerts and stock history, so you can see what has gone out.
- HSN summary and GST summary for your CA, and GSTR-1 JSON download for the GST portal.
- Invoices shared on WhatsApp, SMS, email or PDF, or printed on a thermal printer.
- Dues tracking and udhaar khata with WhatsApp and SMS reminders.
Have a look at the GST billing software page for details.
FAQs
Is a delivery challan mandatory under GST?
It is required when goods move without a tax invoice for the purposes allowed under Rule 55, such as job work or movement not by way of supply. For a normal sale, you issue a tax invoice instead.
Can I use a delivery challan for a sale and give the invoice later?
Only in specific cases allowed by the rules, such as liquid gas where quantity is unknown, or goods sent in batches or lots under the special procedure. In most ordinary sales, the invoice must go with the goods. Confirm your case with your CA.
Does a delivery challan need GST amounts?
Tax rate and tax amount are required where the goods are being transported for supply to the consignee. For job work or own-stock movement, the taxable value is shown, and practice varies on showing tax; follow your CA's advice.
How many copies of a delivery challan should I make?
For supply of goods, three: original for the consignee, duplicate for the transporter and triplicate for the consigner.
Is an e-way bill needed with a delivery challan?
Possibly. The challan does not replace the e-way bill. Whether one is needed depends on the value, purpose and route of the movement.
Conclusion
A correct delivery challan format protects you when goods move without a sale. Keep the purpose clear, fill every field, make three copies, and check e-way bill needs. For sales bills, stock and dues, start with MaterialBill's free plan, and call or WhatsApp +91 98359 42411 for help.
