Why Shippable Subscription item when booked in a sales order, shows as Non shippable in the Workflow

I have created an intercompany sales order with a shippable subscription item. After booking, and running the workflow background program, the item line is directly getting fulfilled and not allowing to ship confirm. Also in the workflow status monitor, it is showing the item as non shippable.

All the item attributes are in place- Shippable flag, OE transactable flag, IB trackable, inventory item flag.

Is there any other specific setup for this? so that the shippable subscription can be ship confirmed and treated as a shippable item in the workflow status?