Procedure for goods sent on approval

Brijesh Upadhyay (Practicing Chartered Accountan)   (31 Points)

15 October 2008  

Company, located in Mumbai, is sending its goods to its prospective buyers. These prospective buyers are residing in the state as well as outside the state. Company is sending the goods with its employee alongwith delivery challan. If customer accepts the goods then invoice is raised. It may happen that whole goods will be taken back by the employees if goods are not accepted. There is only delivery challan during transit till goods are accepted.

 

Issue is:

What is the proper procedure for sending the goods both for interstate and intrastate?