item catagory determination enables, the system praposes 
the corosponding item catagory for sales document type 
through item catagory group.
t-code:vov4
fields in the item catagory determination:
sales document type
item catagory group
item usage
highier level item catagory
default item catagory
manuval item catagory

Thanks Sri.
What u said is determination of item categary. There we r 
using usage. 
How & Where usage maintained? How to assign them in system 
so that they will identified & accordingly item categary 
will change?

The usage is used to determine the ITEM CATEGORY, it is 
maintained in CUSTOMER MATERIAL INFO RECORDS ,in the bottom 
most part of the screen u can see it.

Usage is used primarily for text items to go with the 
standard item.

For ex. repairs for a material.

Standard Material -  TAN
Service-Repair    -  Text material

Item category determination : sales document type+ item 
category group+ usage + higher level item category

standard item category : OR +NORM --TAN

For Material Determination

Usage we use is PSHP for Displaying Main Items 
Usage we use is PSEL for Displaying Sub Items

This usage we use for OUTCOME

Outcome: outcome controls whether substituted material 
should be replaced or displayed as sub items.

For Free Goods

Usage is free

so configure this usages in vov4.

some cases the system itself identifies the usage. for
example when u jus type some text in the description in the
order it automatically identifies it to be a text item with
TATX as item category.. here usage text is automatically
determined..