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Delivery challan for replacement of goods

Danish (Accounts Executive) (73 Points)

15 June 2018

WE HAVE SUPPLIED A PLASTIC CONTAINER TO OUR CLIENT IN APRIL 2018 AGAINST TAX INVOICE BUT THE LID(OPENER) OF OUR PRODUCT WAS REJECTED BY THEM SO WE ARE PROVIDING REPLACMENT AGAINST THE DEFECTED GOODS.

SO MY QUESTION IS CAN WE SEND THE LIDS TO PARTY AGAINST DELIVERY CHALLAN AS REPLACMENT NOT FOR SALE.

PLS REPLY.

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7 Replies

CMA Bhavya (Assistant Manager Finance) (862 Points)
Replied 15 June 2018

Dear Sir,

In your case its complete sales return, the replacement invoice can be an fresh Invoice .

you can't supply wide DC alone since its an suply of goods

CGST rules 2017:

Rule 55. Transportation of goods without issue of invoice.-(1)For the purposes of-

(a) supply of liquid gas where the quantity at the time of removal from the place of business of the supplier is not known,

(b) transportation of goods for job work,

(d) such other supplies as may be notified by the Board, the consigner may issue a delivery challan, serially numbered not exceeding sixteen characters, in one or multiple series, in lieu of invoice at the time of removal of goods for transportation,

regards,

Bhavya.P

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Danish (Accounts Executive) (73 Points)
Replied 15 June 2018

dear bhavya,

but it is not complete sales return only part of a product is loose hence rejected so we are sending new lids which will be replaced by the rejected ones and party is not ready to issue credit note against rejection of a part of product so they advice us to send the material against delivery challan.

CMA Bhavya (Assistant Manager Finance) (862 Points)
Replied 15 June 2018

Hi ,

for the Purpose of GST Act Debit Note is similar to Supplimentary Invoice. Inthis case

I feel you can raise the supplimentary Invoice

or else you may raise for the Credit note to the extent of rejected goods,

for your reference: Please find Sec.34 of CGST Act

34. Credit and debit notes.
(1) Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as may be prescribed.

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Danish (Accounts Executive) (73 Points)
Replied 15 June 2018

but party is not ready to accept credit note for partial return of goods they say take ur entire consignment as sales return and send fresh invoice which is not possible for us to bear the transportation charges so we came to solution that will send lids on dc and party will also send the rejected pieces on dc

g mahesh Mundra (Business and tax consultant) (3293 Points)
Replied 15 June 2018

yes I agree with bhavya

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INDRANIL BASU (15 Points)
Replied 07 January 2019

1st take sales return by credit note bcz 1st transaction will be sales return

then issue tax invoice

delivery challan is the case where there is no supply

but thing practically that original sales return will be pertaining to original sales

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Parameswaran Thathamangalam (86 Points)
Replied 27 August 2022

I wrote to CBEC Mithra help desk to know whether tax invoice should accompany for free replacement of goods under warranty or a delivery challan will suffice It was replied that no tax invoice to be issued. But not answered anything about issuing delivery challan