We understand a bit more now that we have more information, so I'm going to add some more detail, but also add that it's working as per design or rather, it's also worked this way.
I have four items: CDKOBS (obsolete at the Item Master), CDKOBS2 (obsolete at the Inventory), CDKOBS3 (active at all levels), and CDKOBS4 (obsolete at the ITEM/Organization level).
In the DR the results VARY depending on what you are selecting when you are forming the Requisition Line Items, this may have resulted in some confusion.
- Using the New Row | Select Value. You will get only CDKOBS2, CDKOBS3, and CDKOBS4. Now, this will result in CDKOBS2 being able to be ordered, but not for the storeroom, you made it obsolete from, CDKOBS3 being able to order including for the storeroom, and CDKOBS4 giving you an error. For CDKOBS4, it's showing on the list because the actual item is not obsolete, only the item at the organization level.
- Using the Select Materials button. You will get CDKOBS, CDKOBS2, CDKOBS3 and CDKOBS4. So, CDKOBS2 and CDKOBS4 will result in an error. CDK2 you can order, just not for the storeroom, you made obsolete from.
So depending on where you're selecting the item, it will show an obsolete item, just understand obsolete at what level. You've only mentioned that your item is obsolete in the Inventory, so all's good. It's just that you will not
be able to order it for the storeroom you made it obsolete from. If it's active in other storerooms, you can still order for them.
- From the Select Value when using the New Row
From the Select Materials button