Cancelled Order Line (non-inv Model item) creating an IB record

Hi Friends,

I am facing strange issue in IB.  Installed Base Item instance is getting created for cancelled order lines (non-inventory Model item/PTO). I cannot exactly say that, line has cancelled in sales order but updated the quantity. Below is the exact issue information of the issue.

We have Model Item, which has multiple components in it (BOM) and it is non -inventory item with Service contracts and IB enabled.

1. We have entered an order Lines with quantity 3 of the Model item

2. Referred a Service Item to Model item line 1.

3. Booked the Order

4. Due to some reason, updated the quantity 3 to 2 ( We did not split the order line, we directly updated the quantity from 3 to 2, as this is a standard process which business is following from very long time)