A delivery challan is used when goods move without a sale — for job work, exhibitions, approvals, or branch transfers. Here is the complete guide with format and GST rules.
A delivery challan is a document issued when goods are transported for reasons other than a sale. Unlike a tax invoice which records a taxable supply, a delivery challan records the movement of goods where no immediate sale takes place — such as sending goods for job work, taking products to an exhibition, shipping goods on approval, or transferring stock between your own branches.
Under GST, a delivery challan is specifically covered under Rule 55 of the CGST Rules. It is legally required for certain types of goods movements. Transporting goods without proper documentation — either an invoice or a delivery challan — can lead to detention at checkpoints and penalties under Section 129. If the goods value exceeds Rs 50,000, you also need an e-way bill along with the delivery challan.
We support delivery challans as one of the 8 document types in myBillPlease. Create challans with proper format, track goods sent and received, and maintain a complete trail for GST compliance. Download a free delivery challan format template to see the structure, or use our GST calculator for any tax-related calculations.
This guide covers when to issue a delivery challan, the mandatory format, GST implications, and the difference between delivery challans and other documents.
Rule 55 of CGST Rules specifies these situations
Three documents for three different situations
| Feature | Delivery Challan | Tax Invoice | Bill of Supply |
|---|---|---|---|
| Purpose | Goods movement without sale | Taxable sale of goods/services | Exempt or composition supply |
| GST charged | No — not a sale | Yes — CGST+SGST or IGST | No — exempt or composition |
| ITC available to receiver | No — not a purchase | Yes — ITC claimable | No |
| Reported in GSTR-1 | No | Yes — Tables 4/5/7 | No |
| GST rule | Rule 55 CGST Rules | Section 31 CGST Act | Section 31(3)(c) |
| E-way bill needed | Yes — if value > Rs 50,000 | Yes — if value > Rs 50,000 | Yes — if value > Rs 50,000 |
| Common use | Job work, exhibitions, approvals | Regular B2B and B2C sales | Composition dealers, exempt goods |
| Number series | Separate challan series (DC-001) | Invoice series (INV-001) | Bill series (BOS-001) |
Rule 55(1) of CGST Rules prescribes the following fields for a delivery challan:
1. Date and number: Sequential challan number in a separate series from invoices. Date of issue.
2. Sender details: Name, address, and GSTIN of the consignor (person sending the goods).
3. Receiver details: Name, address, and GSTIN (if registered) of the consignee (person receiving the goods).
4. HSN code: HSN code for each item being transported. Same requirement as invoices — 4 or 6 digits based on turnover.
5. Description of goods: Clear identification of what is being transported.
6. Quantity: Number of units, weight, or other measurement.
7. Taxable value: Even though no tax is charged, the value of goods must be declared. This is important for e-way bill generation if the value exceeds Rs 50,000.
8. Tax rate and amount: If GST is applicable (rare for challans), show the tax. For most challan scenarios, this is zero or marked as N/A.
9. Place of supply: State where goods are being delivered.
10. Signature: Authorised signatory of the sender.
Download our free delivery challan format template with all fields pre-configured. In myBillPlease, select Delivery Challan as document type — all mandatory fields are included with auto-numbering.
Job work is the most common reason for issuing delivery challans. When you send raw materials to a job worker for processing (like sending fabric to a tailor or metal to a fabricator), a delivery challan documents the movement.
Time limit for return: Goods sent for job work must be returned within 1 year from the date of sending (3 years for capital goods). If not returned within this period, the sender must issue a tax invoice and pay GST as if the goods were sold. This is a critical compliance point — track all open challans and ensure timely return.
ITC-04 filing: If you send goods for job work, you must file ITC-04 quarterly (or annually for turnover up to Rs 5 crore). This return reports all goods sent, received back, and any direct supply from the job worker's premises. The delivery challan details feed into ITC-04.
Supply from job worker's premises: If the finished goods are supplied directly from the job worker's location to your customer, you issue the tax invoice but the delivery challan (and e-way bill) shows the job worker's address as the dispatch point.
myBillPlease tracks delivery challans with job work status — sent, in progress, returned. You can see all open challans approaching the 1-year deadline and take action before the time limit expires. This prevents unexpected tax liability from unreturned job work goods.
When goods move with a delivery challan and the consignment value exceeds Rs 50,000, an e-way bill is mandatory — even though it is not a sale.
Document type on e-way bill: Select 'Delivery Challan' as the document type when generating the e-way bill. Enter the challan number and date — not an invoice number.
Supply type: For job work, select 'Others' as supply type with the sub-type 'For Job Work'. For exhibitions, select 'Others — For Exhibition'. This classification matters for correct e-way bill generation.
Validity: E-way bill validity for delivery challans follows the same distance-based rules as invoices — 1 day for up to 200 km, 3 days for 200-400 km, etc.
Return journey: When goods return from job work or exhibition, a new delivery challan and a new e-way bill are needed for the return journey. The original challan covers only the outward movement.
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