Intercompany AR invoice created from SCFO - Transfer orders not calculating Tax where as IC AP is ca

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We have2 separate Transfer orders created in 1 BU and sold to the other BU - 1 Transfer order has Source and Destination Sub-inventory as FG  i.e Finished Goods and the other has RM - Raw material and packing.. 

Transfer Order with FG sub-inventory - IC AR invoice is created with Transaction Business Category as " Intercompany transaction" with the correct Tax calculated for the invoice. 

Transfer ORder with RM Sub-inventory - IC AR invoice is created with no tax calculated for it. The transaction Business category is Sales_TRansction " In this case. 

 

Is the transaction business category driving the tax calculation for the IC AR invoices. Any pointers on why 1 IC Ar invoice is calculated without tax would really help?