Movement Between same GST Units

[JOHN SHANNEL]

Hello friends,

Our organization has 2 units which is 500 meters apart and has same GST number. While transferring inventory between the units, do i need to raise delivery challan as per rule 55 and show taxable value, tax rate and tax amount. Please clarify.

 

[Ganeshan Kalyani]

Yes, Sir, you will have to raise delivery challan. As regard tax rate and amount, it is shown on DC as a general practice, otherwise law requires to mention tax only when there is a supply.

[KASTURI SETHI]

Here is legal backing in support of the reply of Sh.Ganeshan Kalyani Ji.

FAQ dated 31.7.2017 issued by Board.

Question 15 : Which is the document required to be issued by the Registered Person for supply of goods from one premises to another premises under the same registration number?

Answer : In terms of Rule 55(1)(c) of the CGST Rules, 2017 such movements have to be effected under the cover of a delivery challan along with any other document that may be prescribed in lieu of the e-way bill.

[JOHN SHANNEL]

Thanks for the clarification, I am confused with the below clause, where it says tax rate and tax amount is required to be mentioned only in case of supply to consignee. In my case since sender and receiver are same GST consignor and consignee are same ( my interpretation). Please clarify.

(vii) tax rate and tax amount – central tax, State tax, integrated tax, Union territory tax or cess, where the transportation is for supply to the consignee;

[KASTURI SETHI]

 There is nothing to  worry about. The reply of Sh.Ganeshan Kalyani Ji is very much clear. When no supply is involved, why to worry about rate of tax and amount of tax. You want to store the goods and not to sell/supply the goods.  For your satisfaction, you can mention the rate of tax (purchase) and amount (purchase). 

[Shilpi Jain]

Delivery challan is also a document to update your inventory position at each location. So any movement should be backed up by a document which is DC is the present case

[Padmanathan KV]

agree with views of experts. DC need not mention tax.

AI Summary

Movement between units under same GST requires a delivery challan; tax rate and amount needed only for supplies. Movement of goods between premises under the same GST registration must be effected under a delivery challan, which serves as the prescribed transport and inventory document. Tax details (tax rate and tax amount) are required on the challan only when the transportation is for a supply to the consignee; for internal transfers or storage between units under the same registration, showing tax particulars is not legally required, though optional notation of purchase tax for accounting is permissible.