Guides · GST
Delivery challan, explained
A delivery challan is the document used to move goods where a tax invoice is not issued at the point of movement — for job work, goods sent on approval, stock transfers, and similar cases.
When a delivery challan is used
GST allows a delivery challan instead of a tax invoice for specific movements: sending goods for job work, moving goods on approval or on a sale-or-return basis, transferring stock between the same business's locations, and other cases where the supply is not complete at the moment of transport.
The challan travels with the goods so the movement is documented even though no tax invoice is raised yet.
What a delivery challan shows
A delivery challan carries the date and number, the consignor and consignee details, the HSN and description of the goods, the quantity, the taxable value, the tax where applicable, and the place of supply. It is generally prepared in triplicate for goods movement.
Where the value crosses the e-way bill threshold, the challan is the document the e-way bill is generated against.
How Lekha generates challans
Lekha generates GST-compliant delivery challans and tax invoices against a purchase order, with HSN, place of supply, and the right CGST/SGST or IGST split computed live, and gap-free financial-year numbering.
For job-work and transfer movements, the challan is generated with the same tax fields checked, so the paperwork that leaves with the goods is correct.
Questions
- What is the difference between a delivery challan and an invoice?
- An invoice records a completed taxable supply and charges tax; a delivery challan moves goods when the supply is not complete at that point, such as for job work or stock transfer.
- When can I use a delivery challan instead of a tax invoice?
- For job work, goods sent on approval or sale-or-return, and transfers between a business's own locations, among other cases the GST rules allow.
- Does a delivery challan need an e-way bill?
- If the consignment value crosses the e-way bill threshold, the e-way bill is generated against the delivery challan for the movement.
This guide is general information, not legal or tax advice. Confirm the current rules and your own circumstances for any specific case.