Tracking material sent out for job work: challan, return and billing

The lot begins at the gate pass. Not when the processor starts work. Record the challan number, date, part code, heat or batch number, quantity, unit of measure, vehicle and processor on the same line, before the truck leaves the gate.

Name the process on the challan. Anodising, powder coating and CNC finishing give very different yields, and without the process named the receiving clerk cannot judge whether a return looks right. It is a small field. Fill it in.

Set a due date on issue day. Rules such as India’s GST job work provisions tie tax-free movement of goods to a return window, and a lot with no due date slips past it unseen. The register should sort open lots by days left, so the oldest and nearest deadlines sit at the top of the page every morning.

Material rarely returns as it left. Some pieces come back finished, some as scrap, and some as rejects that need rework or a second pass through the same furnace or plating tank. One received quantity hides all three.

Book each return against the original challan, quoting the processor’s own delivery note, so the clerk counts, the inspector clears the pieces and the store posts them to stock. Big lots return in trips. Allow partial receipts against the one challan, so that four trips from the plating shop or the furnace still add up to a single lot.

Weigh the scrap. A turned shaft loses metal as swarf, so five hundred shafts returning with no scrap at all should prompt a call to the workshop about the lathe.

The balance is plain arithmetic. Quantity issued, less good pieces, less scrap, less rejects, equals the quantity still outside the gate, and at zero the lot closes. Until the balance reaches zero, the lot stays on an ageing report that the stores head reads every Monday, grouped by processor and sorted by days outstanding.

That report is the most useful page. One lot that has sat for ninety days at one workshop is either forgotten or lost, and a named person must call the owner of that workshop today.

Link the lot to the bill of materials, so returned pieces move into their next operation and planners see the part before the assembly line sits idle. Stock stays honest.

Never pay on a phone call. Match the invoice to the lot, checking quantity returned, rate, tax and any deduction for rejection, and hold the payment run until challan, receipt and invoice all agree. Any gap goes back to the processor.

Rates start the usual arguments. The buffing shop charges per piece, the heat treater per kilogram and the plater per rack, so one lot can carry three different bases across its journey. Store the agreed basis on the lot itself, so that nobody has to dig through old emails and messages to settle a dispute over a rate.

Debit notes belong in the same record. If the processor chipped a casting during fettling, the deduction is raised from the lot, with the inspection report and a photograph attached, so nobody hunts through email.

Tax officers and auditors ask four things. What went out? When? To whom? And what came back? A lot record answers all four on a single page, with the challans, receipts, processor invoice and debit notes linked to it, so nobody rebuilds the trail from memory.

Check your country’s rules with your accountant. Software gives no legal advice. What it does is hold the dates and quantities that those rules depend on, and warn you well before a return window closes on any open lot.

This week, list every open lot older than sixty days from your notebooks, noting processor, quantity, part and challan date for each one. That list is your first ageing report.