Most of the time during the transactions of goods and services, the recipient makes payments immediately. However, sometimes, the payment processing may get a bit delayed. In such circumstances, the supplier presents a delivery challan that contains the value of goods or services along with the other details. In this article, you’ll learn everything about the delivery challan format along with the guidelines for generating the same!
A Delivery challan is an important document required while transporting goods from one place to another.
What is a Delivery Challan?
Basically, a delivery challan is a document that is generated during the transportation of goods from one point to another which may or may not result in a conversion.
This document is shipped along with the goods. It contains details like the quantity, price and type of goods, the name of the sender as well as receiver, the delivery address and so on.
Cases In Which Delivery Challan Is Issued
Normally, a GST invoice is issued when either the supply of goods is made or the payment is made by the receiver. For most services, the tax invoice must be issued within 30 days of final delivery.
There are cases in which instead of a GST invoice, a delivery challan is generated and sent along with the goods. Below are some scenarios when a delivery challan must be issued for the transportation of goods in absence of an invoice:
- Transportation of goods or services for jobs.
- Supply of liquid gas where the quantity of shipment is not known.
- Transportation of goods for a different reason than the way of supply.
Once the delivery challan is issued to the recipient of goods, the supplier can issue the GST tax invoice within a month from the delivery date.
What Is The Difference Between A Delivery Challan And An Invoice?
Because of their similarities, some people think that the delivery challan and invoice are the same things, which is not true. Here is the difference :
An invoice is a document that buyers use as legal proof of ownership of the goods or services. Using an invoice, the customer accepts the goods, their ownership along with all the rights, liabilities and risks associated with them. In the scenario of goods transported via multiple shipments in a semi or full knocked down situation, the supplier must issue a full invoice before dispatching the first shipments and shall issue a delivery challan for the next shipments, including a reference to the invoice.
This is about the invoice, a delivery challan is completely different from it.
As mentioned above, a delivery challan is issued with the purpose of displaying that the recipient has acknowledged the receipt of the consignment, but not the responsibility and ownership of the goods in it.
Another point of difference between the two types of documents is, a delivery challan doesn’t indicate the value of goods delivered while the invoice does.
Delivery Challan Format
Delivery Challan format is the most important thing to keep in mind and understand before generating the document. A slight change or mistake in delivery challan format can result in a lot of inconveniences.
First, the Delivery challans should be numbered serially and shouldn’t contain more than 16 characters. The right delivery challan format should include the following details :
- Date and serial number
- Name, physical address and GSTIN number of the supplier
- Name, address and GSTIN of the receiver, if registered
Detailed description of goods
- HSN codes of all the goods included in the shipment
- Taxable value of supply and the quantity of goods
- GST tax amount, tax rate broken down like SGST, CGST, IGST
- Location of supply
5 Important Guidelines While Generating A Delivery Challan
1. In the case of supply of goods, the delivery challan must be generated in triplicate, in the manner mentioned below:
- The original document named as ORIGINAL FOR CONSIGNEE
- The duplicate document named as DUPLICATE FOR TRANSPORTER
- The triplicate copy named as TRIPLICATE FOR CONSIGNOR
2. The place mentioned in the delivery challan, where goods are transported, must be also declared in the Form.
3. The place where the goods are being shipped are for supply purpose to the receiver but the GST invoice cannot be issued at the time of removal of the goods, the supplier must send an invoice after the final delivery.
4. When the goods are transported in a semi or a full knocked down situation. Below things should be kept in mind:
- The supplier must issue the full invoice before dispatching the first shipment.
- The supplier must issue the delivery challan for each of the remaining shipments while offering a reference to the invoice.
- Each shipment must be dispatched along with the copies of the right delivery challan format and a duly copy of the tax invoice.
- The original copy of the tax invoice must be issued with the last shipment.
5. In the instance of supply of goods with a value of Rs. 50 thousand including the tax, a GST invoice must be sent by the supplier.
These are the points that one needs to keep in mind while generating a delivery challan. This will help in knowing its proper usage and also eliminate errors that generally happen in the format of a delivery challan.