Under GST, transport of goods should be accompanied by a ‘Tax Invoice’ or ‘Bill of Supply’. When a registered dealer supplies taxable goods, Tax Invoice should be issued and when the dealer supplies exempted goods, Bill of Supply is to be issued. A composition tax payer should issue a Bill of Supply for all supplies.
However, there can be scenarios when a person cannot issue a Tax Invoice or Bill of Supply for a supply. The scenarios of transport of goods without invoice are:
When goods are supplied by a registered dealer to a job worker for further processing, no tax is applicable. Hence, issue of a Tax Invoice or Bill of Supply will not serve the purpose of sending goods for job work.
Businesses can have additional places of business under a single registration in a State. When goods are sent by a branch to the other branch under the same registration, no tax is applicable. Hence, the supplier cannot issue a Tax Invoice or Bill of Supply in such a case.
When liquid gas is supplied and the quantity at the time of removal from the place of business of the supplier is not known, the supplier will be unable to issue a Tax Invoice or Bill of Supply for the supply.
Sale on approval is a business arrangement, wherein, an individual or a company who is interested in purchasing a specific item is allowed to use the item for a given period of time. At the end of that time, if the person is satisfied with the item, they will agree to purchase it. However, if the person is dissatisfied for any reason, they are allowed to return the item. When goods are supplied on ‘Sale on approval basis’, a Tax Invoice or Bill of Supply cannot be issued, as at the time of removal of goods, the sale is not confirmed.
In all the above cases, a Tax Invoice or Bill of Supply cannot be issued. At the same time, when goods are removed from a registered person’s premises, it should be accompanied by a valid document. Hence, in these cases, a ‘Delivery Challan’ can be issued under GST.
The delivery challan sample format to be issued in scenarios which require transport of goods without invoice, is shown below:
Copies of delivery challan under GST
A delivery challan issued for transport of goods without invoice should be prepared in triplicate:
Original copy, marked as Original for consignee
Duplicate copy, marked as Duplicate for transporter
Triplicate copy, marked as Triplicate for consignor.
Hence, in certain business scenarios, goods cannot be transported with a Tax Invoice or Bill of Supply. In these cases, a delivery challan can be issued when goods are removed from the place of business of the supplier.