If your business ships physical goods to customers, you've probably dealt with the frustration of delivery disputes. "I ordered 50 units but only received 48." "The goods arrived damaged." "I never received the shipment." Without proper documentation, resolving these disputes becomes a nightmare of he-said-she-said.
That's exactly what a delivery note is designed to prevent. It's a simple document that accompanies your shipment and serves as proof of what was sent, when it was sent, and what condition the goods were in. Yet many small businesses skip this critical step, leading to costly disputes and lost trust.
What Is a Delivery Note?
A delivery note (also called a delivery slip, dispatch note, or packing slip) is a document that accompanies goods during shipping. It provides the recipient with a detailed list of items included in the shipment so they can verify that everything they ordered has been received in the correct quantity and condition.
Unlike an invoice, a delivery note does not contain pricing information. Its sole purpose is to document what's in the package — think of it as a "contents checklist" for your shipment.
Delivery Note vs. Delivery Challan
In India, you'll often hear the term "Delivery Challan" used interchangeably with delivery note. While they serve similar purposes, a delivery challan has specific legal significance under GST law — particularly when goods are transported without a sale (such as goods sent for job work, exhibition, or on approval basis).
Under GST regulations, a delivery challan is required in situations where goods are transported but a tax invoice cannot be issued at the time of movement. This includes:
- Supply of liquid gas where quantity is unknown at removal time
- Transportation of goods for job work
- Transportation of goods for reasons other than supply (exhibition, demo, approval)
- Semi-knocked down (SKD) or completely knocked down (CKD) supplies
Why Does Your Business Need Delivery Notes?
1. Proof of Delivery
When the recipient signs the delivery note, you have documented proof that the goods were received. This protects you against claims of non-delivery. In case of disputes, a signed delivery note is your strongest evidence.
2. Accuracy Verification
The delivery note allows the recipient to check each item against the order. If there are missing items, wrong items, or damaged goods, they can note it on the delivery note at the time of receipt. This catches issues immediately rather than days later.
3. Inventory Management
For both the sender and receiver, delivery notes serve as a record for inventory tracking. When goods leave your warehouse with a delivery note, you can update your stock records accurately. The receiver can similarly update their incoming inventory.
4. Legal Compliance
In India, transporting goods worth more than ₹50,000 without proper documentation can lead to goods being detained by tax authorities. A delivery note or challan serves as the documentation that the transport is legitimate.
5. Professional Image
Businesses that include delivery notes with their shipments appear more organized and trustworthy. It shows attention to detail and gives the customer confidence that you take quality seriously.
What to Include in a Delivery Note
A complete delivery note should contain these essential elements:
| # | Element | Details |
|---|---|---|
| 1 | Delivery Note Number | Unique sequential reference (e.g., DN-2026-0087) |
| 2 | Date of Dispatch | When the goods left your premises |
| 3 | Sender Details | Your company name, address, and contact information |
| 4 | Recipient Details | Customer name, delivery address, and contact person |
| 5 | Order/PO Reference | Link to the original purchase order or quotation number |
| 6 | Item List | Description, quantity, and unit for each item shipped |
| 7 | Item Condition | Notes on the condition of goods at dispatch |
| 8 | Transport Details | Vehicle number, transporter name, tracking number (if applicable) |
| 9 | Received By | Space for the recipient's name, signature, and date |
| 10 | Special Instructions | Handling instructions, fragile notices, storage requirements |
Important: A delivery note should NOT include prices. It's purely a logistics document confirming what was shipped. Pricing goes on the invoice.
Delivery Note vs Invoice: Key Differences
| Feature | Delivery Note | Invoice |
|---|---|---|
| Purpose | Confirm what was shipped | Request payment |
| Contains prices? | No | Yes |
| Contains tax info? | No | Yes (CGST, SGST, IGST) |
| When sent | With the shipment | After delivery (or with it) |
| Signed by | Recipient (on receipt) | Not typically signed |
| Used for ITC? | No | Yes |
| Legal requirement | For goods transport above ₹50,000 | For every taxable supply |
When Do You Need a Delivery Challan Under GST?
Under GST rules, a delivery challan is specifically required in these scenarios:
1. Job Work
When you send raw materials or semi-finished goods to a job worker for processing, you must accompany them with a delivery challan. The challan should include details like the job worker's name, address, GSTIN, and description of goods sent.
2. Supply on Approval Basis
When you send goods to a buyer on an approval basis (they can return if not satisfied), the initial transport needs a delivery challan, not an invoice. The tax invoice is issued only when the buyer confirms acceptance.
3. Exhibition or Demo
Goods sent for display at exhibitions, trade shows, or product demonstrations need a delivery challan since no sale is happening at the time of transport.
4. Branch/Warehouse Transfers
Moving goods between your own branches or warehouses requires a delivery challan. Even though there's no sale, the goods are in transit and need documentation.
How to Create a Delivery Note with ProQuote
Creating a professional delivery note is straightforward with ProQuote:
- Open ProQuote and select "Delivery Note" as your document type
- Add your company details — name, address, phone, and any relevant registration numbers
- Add the recipient's details — name, delivery address, and contact person
- Enter dispatch information — date, vehicle number, transport details
- Add your items — description, quantity, and condition notes for each item
- Add special instructions — fragile handling, storage requirements, etc.
- Export as PDF — print two copies (one for you, one for the recipient to sign and return)
Create Delivery Notes for Free
Professional delivery notes with dispatch tracking, item conditions, and PDF export. No sign-up needed.
Create Delivery Note →Best Practices for Delivery Notes
- Always print two copies — one stays with the recipient, one comes back to you with a signature
- Number them sequentially — just like invoices, delivery notes should have a consistent numbering system
- Match to orders — always reference the original Purchase Order or Quotation number on the delivery note
- Note partial shipments — if you're shipping an order in multiple batches, clearly mark "Shipment 1 of 3" etc.
- Get signatures — a delivery note without a recipient signature is just a packing list. The signature is what gives it legal value as proof of delivery.
- Store digitally — keep scanned copies of signed delivery notes linked to the corresponding invoice in your records
- Check before shipping — use the delivery note as a final packing checklist. Have someone verify each item against the list before sealing the package.
Common Delivery Note Mistakes
- Skipping the delivery note entirely — "We'll just send the invoice." Without a separate delivery note, you lose proof of what was physically delivered.
- Inaccurate quantities — Always count items carefully. A delivery note that says "50 units" when you shipped 48 creates problems.
- No reference to the order — Without a PO or order number, the recipient may struggle to match the delivery to their records.
- Including prices — Delivery notes should not show prices. This is especially important when the delivery person is different from the buyer.
- Not getting signatures — An unsigned delivery note has minimal legal value. Always insist on a signature.
Key Takeaways
- A delivery note documents what was shipped — it's your proof of delivery
- It does NOT include prices or tax information (that's the invoice's job)
- In India, a delivery challan is legally required for transporting goods in certain GST scenarios
- Always get the recipient's signature on the delivery note
- Use delivery notes alongside invoices for complete transaction documentation
- ProQuote makes it easy to create professional delivery notes for free
Related reading: Invoice vs Bill vs Receipt | Complete Guide to GST Invoicing