Service Item Configurations

Service Item Configurations

The schedule line assigned to the TAD item category is CD... This is schdule line category CD is not releveant for inventory, I mean there will not be any movement type assigned to this Schedule Line  Category . And also check up the item category TAD relevant for billing field will be having 'B' - Order related billing...

TAD is set as a standard item with schedule line and delivery and all there. The notion is that services are delivered to the customer. As such, you may want to create a delivery to record the actual date the service was rendered. Creating of a delivery for service item in itself does not create any inventory movements. So, you may want to think about whether you really do not want to have deliveries for your service items.

If you truly don`t want deliveries. What you can do is to make copy of item category TAD (ie ZTAD) and change the item category type from standard (BLANK) to value item (A). 
Leave schedule line allow turned on and make sure item relev for delivery flag is turned off. 
Also do usual item category determination for ZTAD. This way, no delivery will be created for service items.

PS... the reason why the order quantity field is greyed out when you disallowed schedule line is that SAP treat the item like a credit memo request item and will start looking for the target qty field instead.