Update from Catalog option is disabled on Process Requisition Page

In the Process Requisition page, The requisition lines Update from Catalog action is always disabled whether the PR lines has a source agreement or not.

We have defined local catalogs both for requisitioning and purchasing usage but we are unable to enable the Update from Catalog option.

Few other threads on this subject suggested that we need to disable the budgetary control.

We have disabled the budgetary control in our test POD but still it is not updatable.