My requirement is to make an item inactive so that it should not be selected for creating sales order.
Whereas it should be available in service contracts form.
Also let me know what all checks needs to be done before making it inactive.
Cover the whole demand supply spectrum before making the item inactive - Open purchase releases - anything in receiving - Material transactions - Onhand Qty - Open sales orders / shipments etc
These would be generic depending upon the products you have installed
Just uncheck the customer order enabled, customer orderable flags in the Order Management tab of the item master.