A delivery challan and an invoice both accompany goods, but they do different jobs. An invoice records a sale and the tax on it; a delivery challan records that goods are moving, usually when no invoice can be issued yet. Here is when each is used under GST.
What is the difference between a delivery challan and an invoice?
An invoice is issued for a supply and shows the value and tax. A delivery challan is issued when goods are transported without a sale being completed or invoiced at the time — for example goods sent for job work. It lists the goods being moved, not a demand for payment.
| Delivery challan | Tax invoice | |
|---|---|---|
| Purpose | Accompany goods in transit where no invoice is issued at the time | Record a taxable supply and the GST charged |
| Demands payment? | No | Yes |
| Buyer can claim ITC? | No | Yes, if eligible |
| Typical use | Job work, goods sent on approval, movement that is not a supply | Sale of goods or services |
| Governing rule | Rule 55, CGST Rules | Rule 46, CGST Rules |
When is a delivery challan used?
Rule 55 of the CGST Rules allows a delivery challan, in place of an invoice, in situations such as:
- Transporting goods for job work.
- Transporting goods for reasons other than a supply — for example goods sent for repair or display.
- Supply of goods where the exact quantity is not known at the time of removal, such as liquid gas.
- Goods sent on approval for sale or return, before the supply takes place.
The rule also covers a few other notified cases. Check Rule 55 for your situation.
What must a delivery challan contain?
- The challan date and a consecutive number
- Name, address and GSTIN of the consignor (and of the consignee, if registered)
- HSN code, description and quantity of the goods
- Taxable value, tax rate and tax amount where the movement is a supply
- Place of supply for inter-state movement, and the place of delivery
- Signature of the consignor or authorised representative
Challans are issued in triplicate for goods: the original goes to the consignee, the duplicate to the transporter and the triplicate stays with the consignor. Goods of higher value may also need an e-way bill; check the current limit and rules.
Do you still issue an invoice after a challan?
If the movement turns out to be a supply — for example the buyer accepts goods sent on approval — you issue a tax invoice within the time the GST rules allow. A challan alone does not record a taxable sale. Learn what the invoice must contain in how to create a GST invoice.
Related guides: how to create a GST invoice, proforma invoice vs tax invoice, HSN code vs SAC code, invoice vs bill vs receipt, electrician, plumber and mechanic bill format.
Need to send goods? Create a delivery challan free — no sign-up, no watermark. Create a delivery challan
Frequently asked questions
What is a delivery challan?
A delivery challan is a document that accompanies goods in transit when a tax invoice is not issued at the time, for example for job work or goods sent on approval.
Is a delivery challan the same as an invoice?
No. A challan records the movement of goods; an invoice records a sale and the tax charged.
How many copies of a delivery challan are required?
Three for goods: original for the consignee, duplicate for the transporter and triplicate for the consignor.
Can the buyer claim input tax credit on a delivery challan?
No. Input tax credit requires a valid tax invoice.
Related guides
- Proforma Invoice vs Tax Invoice: What's the Difference?
- HSN Code vs SAC Code: What's the Difference?
- GST Invoice vs Bill of Supply: What's the Difference?
- How to Calculate GST on an Invoice (With Examples)
By BillsFreind Team · 2026-10-26 · 3 min read