E-Way Bill Rules for Returns and Other Special Transactions

Quick answer: Rule 138 applies to movement of goods, not only sales, so returns, approval supplies, exhibition goods and similar cases can need an e-way bill once the threshold is crossed. Each movement needs its own e-way bill, and where no sale takes place the document is usually a delivery challan.

Most e-way bill guidance assumes a simple sale: seller invoices buyer, goods move from seller to buyer. Real business is messier. Goods come back, go out on approval, travel to trade fairs, are billed to one party and delivered to another, or are sold off a van on a route. The e-way bill rules still apply to these movements, but the document, the reason and the person generating can change.

This article gives general guidance for the most common special cases. Treat it as a starting point, not a legal opinion — the facts of each arrangement matter, and you should verify the current position on the official portal or with your tax adviser.

The principle that covers all of these

Rule 138 applies to the movement of goods, not only to sales. It covers movement in relation to a supply, for reasons other than supply, and due to inward supply from an unregistered person. So the question is never just "was there a sale?" but:

1. Are goods moving?
2. Does the consignment value cross the applicable threshold (or is it a case needing an e-way bill at any value)?
3. Is the goods or situation exempt under the Annexure to Rule 138(14)?

Where goods move without a sale, the document is usually a delivery challan (Rule 55 of the CGST Rules), and the e-way bill is generated against it with the appropriate reason.

1. Sales returns

When a buyer sends goods back, a new movement begins in the reverse direction.

• Who generates: whoever causes the movement — commonly the buyer (if registered), or the transporter. The original supplier can also generate it as the recipient.
• Document: practice varies. Many businesses use a delivery challan or the buyer's own document for the return movement; the supplier issues a credit note in its books. Choose a consistent practice and confirm it with your adviser.
• Reason: the portal provides a sales return option.
• Value: the value of goods being returned, including tax.

Do not try to reuse the outward e-way bill. It covered only the original trip.

2. Supply on approval

Goods are sent to a customer who may accept or reject them (common in jewellery, machinery, textiles).

• Document: delivery challan at the time of sending; a tax invoice is issued when the customer accepts (within the time limits in the law).
• E-way bill: if the value crosses the threshold, generate against the delivery challan.
• If goods come back: the return movement may need its own e-way bill.

3. Exhibitions and fairs

Goods are sent to a trade fair for display and possible sale.

• Document: delivery challan.
• Reason: the portal has an exhibition or fairs option.
• Unsold goods coming back: a fresh movement; check whether an e-way bill is needed.
• Interstate exhibitions can raise questions about registration and tax at the venue; get advice before you go.

4. Bill-to-ship-to and bill-from-dispatch-from

In a bill-to-ship-to transaction, A sells to B, but on B's instruction the goods go directly from A to C. In a bill-from-dispatch-from transaction, the goods start from a location other than the supplier's own place (for example, a third party's warehouse).

The e-way bill portal provides transaction type options for these arrangements (alongside the regular type and a combination type). In general:

• Only one e-way bill is needed for the single physical movement.
• Part A should reflect the actual dispatch and delivery locations, because those determine distance and validity.
• The billing parties' GSTINs appear as per the portal's fields for that transaction type.

Because the field mapping is specific, read the user documentation before you generate one for the first time.

5. Line sales

A van leaves the godown with stock and sells to shops along a route, without knowing in advance which shop will buy what.

• Document: delivery challan for the goods leaving the godown; tax invoices issued as each sale is made.
• Reason: the portal provides line sales and recipient-not-known options for such movements.
• E-way bill: generated by the supplier for the outgoing load if the value crosses the threshold.

6. Goods sent in SKD/CKD condition or in lots

Large machinery is often dispatched in semi-knocked-down (SKD) or completely-knocked-down (CKD) condition, in several vehicles over several days.

Rule 55 of the CGST Rules sets out the general approach:

• The supplier issues the complete invoice before the first consignment.
• Each consignment moves with a delivery challan referring to the invoice.
• A copy of the invoice goes with the first consignment and the original with the last (check the current rule text for the exact requirement).
• An e-way bill is generated for each consignment, against its delivery challan, with the value of that lot. The portal has an SKD/CKD/lots option.

Summary table

Note: Option names on the portal can change between versions. Pick the one that most accurately describes the movement, and check the latest user documentation.

Example (illustrative)

A Pune machine builder (GSTIN 27ABCDE1234F1Z5) sells a packaging machine worth ₹18,00,000 plus GST to a buyer in Nashik. The machine is too large for one truck, so it goes in three lots on three days.

1. Before the first lot, the builder issues the full tax invoice PMB/26-27/0042.
2. Each lot moves with a delivery challan referring to that invoice: DC/26-27/0301, 0302, 0303.
3. For each lot, an e-way bill is generated against its delivery challan, with that lot's value and the SKD/CKD/lots option, and the truck number in Part B.
4. A copy of the invoice travels with the first lot and the original with the last.

A month later, the buyer returns a defective control panel worth ₹1,20,000 incl. GST. The buyer, being registered, generates an e-way bill for the return movement with the sales return option. The builder issues a credit note in its books.

Common mistakes

• Assuming no sale means no e-way bill. Movement for reasons other than supply is covered.
• Reusing an old e-way bill for the return trip.
• One e-way bill for all SKD/CKD lots. Each vehicle and lot needs its own.
• Wrong delivery PIN in bill-to-ship-to cases. Using the billing address PIN gives the wrong distance.
• Selecting "Supply" for everything. The reason should match the actual movement.
• No delivery challan for line sales or exhibitions. Goods on the road need a document.

Before you rely on this

Special transactions have more conditions than ordinary sales, and they are where rules and portal options change most. Confirm the current rule text and portal procedure for your case, and speak to your adviser for anything unusual.

Official sources

See the E-Way Bill System and its user documentation for transaction types and reason options, CBIC GST for the text of Rules 55 and 138, and GST tutorials for walkthroughs.