From b409ded2f6648852de43e51a2f830b0a1bf57125 Mon Sep 17 00:00:00 2001
From: Pandiyan P <pandiyanpalani37@gmail.com>
Date: Tue, 8 Sep 2026 16:21:55 +0530
Subject: [PATCH] fix(stock): recalculate delivery note billing after return
 (#58869)

(cherry picked from commit f864333afab6c3b1dec7519c2e66b0bb17e548e6)

# Conflicts:
#	erpnext/stock/doctype/delivery_note/services/billing_status.py
---
 .../doctype/delivery_note/delivery_note.py    | 10 +++-
 .../delivery_note/test_delivery_note.py       | 50 +++++++++++++++++++
 2 files changed, 59 insertions(+), 1 deletion(-)

diff --git a/erpnext/stock/doctype/delivery_note/delivery_note.py b/erpnext/stock/doctype/delivery_note/delivery_note.py
index fe132d589d4..92c4dc38386 100644
--- a/erpnext/stock/doctype/delivery_note/delivery_note.py
+++ b/erpnext/stock/doctype/delivery_note/delivery_note.py
@@ -740,6 +740,9 @@ class DeliveryNote(SellingController):
 
 	def update_billing_status(self, update_modified=True):
 		updated_delivery_notes = [self.name]
+		if self.is_return and self.return_against:
+			updated_delivery_notes.append(self.return_against)
+
 		for d in self.get("items"):
 			if d.si_detail and not d.so_detail:
 				d.db_set("billed_amt", d.amount, update_modified=update_modified)
@@ -748,7 +751,12 @@ class DeliveryNote(SellingController):
 
 		for dn in set(updated_delivery_notes):
 			dn_doc = self if (dn == self.name) else frappe.get_doc("Delivery Note", dn)
-			dn_doc.update_billing_percentage(update_modified=update_modified)
+			update_dn_modified = update_modified and dn != self.return_against
+			dn_doc.update_billing_percentage(update_modified=update_dn_modified)
+			if dn == self.return_against:
+				dn_doc.load_from_db()
+				dn_doc.set_status(update=True, update_modified=False)
+				dn_doc.notify_update()
 
 		self.load_from_db()
 
diff --git a/erpnext/stock/doctype/delivery_note/test_delivery_note.py b/erpnext/stock/doctype/delivery_note/test_delivery_note.py
index 56622562d7a..4ee8f3289af 100644
--- a/erpnext/stock/doctype/delivery_note/test_delivery_note.py
+++ b/erpnext/stock/doctype/delivery_note/test_delivery_note.py
@@ -1049,6 +1049,56 @@ class TestDeliveryNote(FrappeTestCase):
 		self.assertEqual(dn.per_billed, 100)
 		self.assertEqual(dn.status, "Completed")
 
+	def test_dn_is_completed_when_unbilled_item_is_returned(self):
+		from erpnext.stock.doctype.delivery_note.delivery_note import make_sales_return
+
+		make_stock_entry(target="_Test Warehouse - _TC", qty=1, basic_rate=100)
+		make_stock_entry(item_code="_Test Item 2", target="_Test Warehouse - _TC", qty=1, basic_rate=100)
+
+		dn = create_delivery_note(do_not_submit=True)
+		dn.append(
+			"items",
+			{
+				"item_code": "_Test Item 2",
+				"warehouse": "_Test Warehouse - _TC",
+				"qty": 1,
+				"rate": 100,
+				"conversion_factor": 1,
+				"allow_zero_valuation_rate": 1,
+				"expense_account": "Cost of Goods Sold - _TC",
+				"cost_center": "_Test Cost Center - _TC",
+			},
+		)
+		dn.submit()
+
+		si = make_sales_invoice(dn.name)
+		si.set("items", [item for item in si.items if item.item_code == "_Test Item"])
+		si.insert()
+		si.submit()
+
+		dn.reload()
+		self.assertEqual(dn.per_billed, 50)
+		self.assertEqual(dn.status, "Partially Billed")
+
+		return_dn = make_sales_return(dn.name)
+		return_dn.set("items", [item for item in return_dn.items if item.item_code == "_Test Item 2"])
+		return_dn.insert()
+		# Mimic the submit request, which reconstructs the document from client data.
+		return_dn = frappe.get_doc(return_dn.as_dict())
+		return_dn.submit()
+
+		dn.reload()
+		self.assertEqual(dn.items[1].returned_qty, 1)
+		self.assertEqual(dn.per_billed, 100)
+		self.assertEqual(dn.status, "Completed")
+
+		return_dn.cancel()
+
+		dn.reload()
+		self.assertEqual(dn.items[1].returned_qty, 0)
+		self.assertEqual(dn.per_billed, 50)
+		self.assertEqual(dn.status, "Partially Billed")
+
 	def test_dn_billing_status_case2(self):
 		# SO -> SI and SO -> DN1, DN2
 		from erpnext.selling.doctype.sales_order.sales_order import (