A central kitchen sends ice cream, sauces and packaging to its outlets every day. The question every chain asks sooner or later: what paper goes in the van? The short answer depends on the GSTINs at both ends. This is a plain guide to the usual cases, and to the limits worth checking with your accountant.
Inside one GSTIN: a delivery challan
When an outlet has no GST registration of its own and bills on head office's GSTIN, the goods move within one registration. Nothing is sold, so there is no tax invoice. The goods travel on a delivery challan, the document the GST rules provide for goods moved other than by way of supply.
Between two GSTINs: a tax invoice
A business with registrations in two states, or two registrations in one state, has distinct persons under GST. A supply between distinct persons is taxable even when no money changes hands. So when the kitchen sends stock to an outlet with its own GSTIN, it raises a tax invoice: CGST and SGST in the same state, IGST across states. The value of supplies between distinct persons follows the valuation rules, which is worth a word with your accountant when you set your markup.
To a franchise: a tax invoice
A franchise is a separate business, so stock sent to it is an ordinary sale: a tax invoice, B2B when the franchise has a GSTIN, B2C when it does not.
When something arrives short
If the outlet counts less than the invoice says and pays only for what arrived, the kitchen issues a credit note against that invoice, and reports it in the return for the month it is issued.
The van and the portal
- E-way bills. A consignment above the e-way bill limit (₹50,000 in most cases; some states set their own limits for movement within the state) needs an e-way bill before it moves, including many movements on a delivery challan.
- E-invoicing. A business whose aggregate turnover crossed ₹5 crore in any year must report its B2B invoices and notes to the e-invoice portal and print the IRN and QR code. Larger businesses have a time limit for reporting, so check yours.
- Invoice numbers. Each GSTIN needs a unique series for the financial year, up to 16 characters. A short prefix per outlet keeps bills on one GSTIN from ever sharing a number.
How QuickKOT handles it
With Hub & Spoke, head office sets each outlet once: company-owned or franchise, its GSTIN, its markup and GST on supplies. At dispatch QuickKOT prints the delivery challan or the tax invoice that setup points to, with HSN, GST rate, batch and expiry on every line. Shortages create credit notes. The GST tab prepares the GSTR-1 Excel, the e-way bill JSON and, when turned on, the e-invoice JSON. You or your accountant check them and file.
QuickKOT is a software service. We built these documents and files to follow the GST rules as we understand them, but we do not guarantee that they are complete or correct for your business, and QuickKOT does not file returns or enforce compliance. Rules and limits change. Check rates, HSN codes, place of supply and every file with your chartered accountant before you file. This post is general information, not legal or tax advice.
Questions
Is a stock transfer to an outlet on the same GSTIN a supply?
Generally no: the goods move within one registration, so they travel on a delivery challan, not a tax invoice. An e-way bill may still be needed for the movement. Check your case with your chartered accountant.
Why does an outlet with its own GSTIN get a tax invoice?
Two GST registrations of the same business are treated as distinct persons, and supplies between distinct persons are taxable even without payment. So the central kitchen raises a tax invoice.
Does QuickKOT guarantee the documents are correct?
No. QuickKOT is a software service. We built the documents and files to follow the GST rules as we understand them, but your rates, HSN codes, values and filings stay your responsibility and your accountant's.
Related: GST for restaurant chains and Hub & Spoke for restaurant chains.
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