Shadow Clone Jutsu v1 (
Version 2)
This is a B-rank ninjutsu that creates solid clones which are physically indistinguishable from their creator; they possess the same body, appearance, chakra, clothing and equipment. The jutsu uses chakra to create a clone, divides the user's chakra evenly between them and the clone and
constantly provides chakra to maintain the clone's existence.
Clones are able to generate and mould chakra for jutsu which means they can use all the skills and jutsu that the original possesses.
The clone's body is composed of chakra that has been transformed into impermanent matter to the point that they appear completely real even to doujutsu. And while the clone's possess the same personality and will as the creator, they are ultimately subservient to him and follow his commands. They share a link with their creator who maintains their existence as the chakra that composes them is finite. It allows him to dispel them, give non-verbal commands, know how many exist and where they are in relation to him.
Sometimes, a seal is cloned as well but whatever is sealed inside is not as it exists within a separate space. If creator has a storage scroll containing a single kunai and they create a shadow clone, the clone can use their copied storage scroll to remove the kunai. But if the creator attempts to do the same afterwards, they will not be able to retrieve anything because there was only one kunai.
When a clone runs out of chakra or takes enough damage, they dispel automatically. How much damage they can receive before disappearing is dependent on the will of the clones and/or the creator, though critical and lethal blows will guarantee their destruction and can only be delayed.
When a clone is dispelled, their chakra is returned to the creator and any other existing clones so that their chakra remains evenly distributed. This chakra carries the memories of everything the clone experienced. This is most commonly used for spying and scouting purposes as it allows the creator to gain information without being physically present. Notably, the clone's memory of death are brief and muted as their final memories are jumbled; a self-defence mechanism to prevent the original's mind from being overwhelmed.
A less well-known use is for training which has intense chakra requirements and can cause mental stress. The total amount of experience the user gains is multiplied by the total number of clones being used to train. By having a number of clones training to use the same jutsu, the overall amount of time it takes to master it is reduced in proportion to the number of clones. This is useful for learning something that needs to be learned through repetition and experimentation e.g. shape manipulation, nature transformation, chakra control etc.
Multiple Shadow Clone Jutsu v1
This is an A-rank kinjutsu which uses the Shadow Clone Technique as a base, performing a very similar function and using the same hand-seal. The main difference between these jutsu is that the clones created with this version do not have their chakra return when the clone is expelled, which means that the original (and any other existing clones) do not receive memories of their experiences.
In exchange, the clones are significantly more chakra efficient which allows you to summon more clones with the same amount of chakra, and require less chakra to maintain their existence. This makes it more suited to create a large number of clones for combat without being distracted by the backlash of mental stress. It is labelled forbidden since without the chakra return function, it's easier for someone to exhaust themselves by creating more clones than they can handle.
Since both techniques use the same hand-seal, the difference in how each is used is a matter of intent. Provided that the user is aware of the function of both, they can choose which kind of clone they wish to create. As the Multiple Shadow Clone Technique is a more advanced variant, there is no mention of that chakra return function in the Scroll of Seals since it's not included in this version and it would be expected for someone to already know how to use the Shadow Clone Technique.