Why is the Delivery Challan Important?


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A delivery challan is a document that is used whenever goods are transported from one place to another. For instance, if in a supply chain, some product is being transferred from the head office to the branches then the delivery challan accompanies the product during the shipment right from the start till the product is received. But why is this so important? Its format is similar to an noc format so is it a noc can it be called a noc? Well not quite. Don’t worry in this article we will answer all your questions about the delivery challan:

Why is the Delivery Challan Important

1. Delivery proof

The format of the delivery challan is such that it contains all the information pertaining to the goods supplied including the amount or quantity, the price the date of delivery and sometimes even the receiver’s signature. Hence not only does this help the recipient check whether they have received the right stuff in the right quantity but it also acts as proof that the delivery guy in fact delivered the product to the list buyer and the buyer received it. The signature on the television is an acknowledgement of this fact.

2. Multiple Shipments

Many times you might have noticed that when you buy stuff for someone you know my stuff they receive the goods in multiple shipments. For instance, when you’re ordering our computer parts like keyboards mouse or the screen you might receive these deliveries in different shipments. In such scenarios, the seller or the supplier would issue the delivery challans for each consignment. These would contain a reference number that would link back to an original invoice that contains the details of all the shipments.

3. Goods sent outside India for promotions

When goods are being sent outside India either for promotion or exhibition of some sort then they are not necessarily considered as a supply or export in the traditional sense. Hence since it is not an export there is no letter of undertaking bond to keep track of all records of the goods being sent a delivery challan needs to be issued. When the goods are being sent outside India then the delivery challan format is different from when the goods are being transported domestically.

4. A substitute for e-way bill

As per rule 55A of CGST there is a situation in which you are mandatorily required to give delivery challan with each sale. In case you are supplying for selling goods that don’t require an e-way bill then you need to send the delivery challan. However, there are exceptions to this rule. For instance, if you are sending a tax invoice or some sort of bill then you don’t need or send the delivery challan.

Generally, if there is no sale or transportation of goods then a tax invoice need not be issued. GST dictates that in such scenarios television needs to be issued. Hence it is an extremely crucial document whenever the transportation of goods from one place to another is involved. This is why it is also known as the delivery slip or dispatch slip

What are the differences between a delivery challan and a tax invoice?

1. Ownership details

In a delivery challan, there is no mention of ownership of the legal responsibilities however a tax invoice needs to explicitly state the ownership details and the legal responsibility

2. Content

The delivery challan acknowledges that the customer or the recipient of goods has actually received the product or the goods however the tax invoice only shows the value total value or the net value of the goods

3. Relation to sale

Delivery challan is not always associated with the sale of products. Hence if a delivery challan is being issued it does not necessarily mean that the sale had happened. However, a tax invoice is only issued in case there is a sale-based transaction

4. Rate

The television only shows the rate of the product it is a company and is being delivered. It does not mention the detail about the full value of the total value of the sale. On the contrary tax, an invoice shows the actual value of the products and it also includes details about the taxes that are being applied.


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