Delivery challan is a dispatch challan used in cases where goods are transported before actual supply, such as goods sent for job work or on a sale or return basis. It contains details about delivered goods such as their quantity, description, delivery location and time, name and address of the consignee, etc.
Some of the advantages and uses of a delivery challan are as follows:
Proof of delivery- A delivery challan is sent along with the goods supplied containing all the details of goods. It helps the recipient check which goods have been delivered and cross-check the same with the order placed. An acknowledged copy of the delivery challan by the customer serves as proof of delivery.
Used when goods are sent on an approval basis- It is useful in cases when actual invoice is not prepared as the goods are sent to the customer’s place for sale or return. In such cases, a delivery challan is issued at the time of supply.
Used in cases when the e-way bill is not required- As per Rule 55A of the CGST Rules, delivery challan should be sent with the goods supplied when an e-way bill is not required, and a tax invoice or a bill of supply is not prepared.
Goods supplied in multiple shipments- There are cases where goods are transported in multiple shipments in a semi-knocked down or completely knocked down condition. In such cases, the supplier issues an invoice before the first consignment and then uses a delivery challan for each subsequent consignment along with the details of the original invoice.
Transport of goods outside India for exhibition or export promotion- Such transport is neither considered as supply nor export. As there is no export, a Letter of Undertaking (LUT) or bond is not required. Such goods shall be sent along with delivery challan.
