Returnable challan

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Querist : Anonymous

Querist : Anonymous (Querist)

27 September 2014 What is returnable challan? Under what circumstances we used this challan.

Arun Kumar Singh

Arun Kumar Singh (Expert)

27 September 2014 If goods are removed from factory for any purpose and after some time they are returned to the factory on reternable challan.

Querist : Anonymous

Querist : Anonymous (Querist)

27 September 2014 which type of goods...excisable or non excisable? and do we make any recording in our books of account?

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

21 July 2025 A returnable challan is generally used when goods are moved out temporarily from the factory or premises but are expected to be returned later. This is common in excise and GST contexts for excisable goods.

Key points about Returnable Challan:
Goods Type:
Usually excisable goods or materials related to excisable goods are moved on a returnable challan. For example, raw materials sent for job work, testing, or repair.

Purpose:
The goods leave the factory temporarily and are expected to come back within a stipulated time.

Books of Account:
Yes, you must record the transaction properly in your books. The movement is not a sale or disposal but a temporary transfer. So:

Maintain a register of goods sent out on returnable challans.

Record the goods as issued but not sold or consumed.

On return, record goods received back.

Compliance:
The challan must specify that goods are returnable and contain details like quantity, description, date of issue, and expected return date.

Legal Provision:
Under Central Excise law, returnable challans are used to track such movement without attracting duty liability immediately.

Summary:
Use returnable challans for excisable goods temporarily sent out and ensure proper accounting and documentation are maintained to avoid disputes with tax authorities.

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