Sales order BAPI giving error - No item category available (Table T184 ...

I am trying to create a sales order from a portal application using BAPI_SALESORDER_CREATEFROMDAT2. For certain type of materials, an error message is coming like: 
No item category available (Table T184 ZOR NORM PSA1 ZSME) ZOR
Error
in VBAPKOM 000020 VBAPKOM
Item 000030 does not exist 000030
Sales
document was not changed
I have checked in vov4 and consulted SD consultant. The vov4 settings are set as below and our SD consultant says they are ok and need not be changed, as when we are creating this order in SAP, it is a success.
ZOR NORM PSA1 ZSME
ZOR NORM PSA2 ZSME ZSHP
ZOR NORM PSHP ZTAX
Now, the standard code where this error is coming is calling a function module "RV_VBAP_PSTYV_DETERMINE" which checks for the higher level item category. The material at item 10 meets the criteria, but material at item 20 fails as PSA1 does not have any such row (above) indicating higher level iteam.
Interesting thing is when I try to create the order in SAP with these materials, it creates the order. There is also a material substitution rule in place, which also seems to be working fine.
Debugging the standard code has not yet given any result.

Since you had indicated the VOV4 settings, I presume, the item category ZSME is maintained under the tab "DfItC".
On your comments,
For certain type of materials, an error message is coming like:
I feel, the root cause of the issue is Item Category Group in material master.  Check for those which creates an issue with the one which is running successfully.
thanks
G. Lakshmipathi

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