Quick answer: under GST, a delivery challan is issued instead of a tax invoice when goods move without a sale at that moment, such as sending material for job work, moving stock between your own locations, sending goods on approval, or dispatching liquid gas whose exact quantity is unknown. Rule 55 of the CGST Rules lists what it must contain, and it is made in three copies.
Most small manufacturers and distributors raise more challans than they realise. A tempo leaves with parts for the plating unit, a sample kit goes to a dealer, stock is shifted to the new godown. Each of these needs paper that a GST officer at a check post will accept.
When a delivery challan is used instead of an invoice
Rule 55 allows a delivery challan in these situations:
| Situation | Example |
|---|---|
| Supply of liquid gas where quantity is not known at removal | An LPG tanker filled at the plant, quantity confirmed at the customer |
| Transport for job work | Castings sent to a machining vendor and brought back |
| Transport for reasons other than supply | Stock transfer within the same GSTIN, goods sent for repair, exhibitions, samples |
| Other supplies notified by the government | As notified from time to time |
There is one more case in the same rule. If goods are being moved for supply but the invoice could not be made at the time of removal, you may move them on a challan and issue the tax invoice after delivery.
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A delivery challan must carry:
- Date and number of the challan
- Serial number of up to 16 characters, 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 (central tax, state or union territory tax, integrated tax and cess) where the movement is to a consignee
- Place of supply, for inter-state movement
- Signature
Values on a challan still matter even when no tax is charged. The e-way bill and the job worker's records both need a value.
The three copies
| Copy | Marked as | Who keeps it |
|---|---|---|
| Original | ORIGINAL FOR CONSIGNEE | Goes with the goods to the receiver |
| Duplicate | DUPLICATE FOR TRANSPORTER | Stays with the driver or transporter |
| Triplicate | TRIPLICATE FOR CONSIGNER | Stays in your office |
E-way bill with a challan
Goods moving on a delivery challan are declared under the e-way bill rules. If the movement needs an e-way bill, choose the right sub-type (job work, own use, SKD/CKD, others) and enter the challan number and date as the document. Job work movements between states can need an e-way bill whatever the value, so check the current thresholds for your state before dispatch.
Goods sent in parts (SKD or CKD)
Large machines are often shipped in lots. The rule is:
- Issue the complete tax invoice before the first lot leaves.
- Send each lot with a delivery challan that refers to that invoice.
- Send a copy of the invoice with each lot, certified as a true copy.
- Send the original invoice with the last lot.
Three examples you can copy
Job work
DC/26-27/0142 · 14 Sep 2026 · 500 nos MS brackets, HSN 7326, taxable value ₹62,500 · consignee: Shree Plating Works, Bhosari, GSTIN 27XXXXX · purpose: job work (zinc plating), goods to be returned.
Stock transfer within the same GSTIN
DC/26-27/0143 · 15 Sep 2026 · 40 cartons LED panels, HSN 9405, value ₹3,20,000 · from Pune main warehouse to Chakan godown, same GSTIN · purpose: own use, not a supply.
Sale on approval
DC/26-27/0144 · 16 Sep 2026 · 3 sample sofas, HSN 9401, value ₹1,35,000 · consignee: Urban Nest Showroom · purpose: sent on approval. Tax invoice to be issued when the customer accepts, or goods returned.
Closing the loop
The most common gap is not the challan itself but what happens next. Job work goods have to come back, approval goods have to be invoiced or returned, and nobody remembers which challans are still open.
Keep an open challans list with the expected return or invoice date. In MizUp Finance, a delivery challan can be converted into a tax invoice in one step, so the items, quantities and customer carry over and the challan is marked closed.
Frequently asked questions
Is a delivery challan the same as an invoice?
No. A tax invoice records a supply and creates GST liability. A delivery challan only covers the movement of goods when there is no supply yet, or when the invoice cannot be raised at the time of dispatch.
How many copies of a delivery challan are needed?
Three. The original is marked for the consignee, the duplicate for the transporter and the triplicate for the consignor.
Is an e-way bill required with a delivery challan?
It can be. Goods moving on a delivery challan are declared under the e-way bill rules, so if the value and type of movement need an e-way bill, generate it and quote the challan number.
Can the challan number series be the same as invoices?
Keep them separate. Rule 55 allows one or more series of up to 16 characters, and a separate prefix such as DC/26-27/ makes returns and audits easier.
