Item category based Price list for Inter-company transfer orders

We are using the SCFO to derive the Inter-company transfer price based on the charges defined at Item category level in the Price list (Pricing administration).

We see 3 options for defining the charge (1) Item (2) Product category (3) All items.

Even though we see the Item category as an option in the Price list, we observed that it is not working. However, for the exact same setups if we assign the charge at the Item level in the same price list it is working.

Could someone confirm if this is the expected functionality?