Even in Mat to Mat transfer you can store the Rej mat in a separate storage location.. we have done it and it helps us in many ways rather any problem. We have many SFG materials rejected after production and we transferred them to a common Rej Mat code in a separate storage location for resale/re-circulation consumption.
Benefits:
1. Identification of Rej material
2. Valuation of rej mat
3. Loss on sale of rej mat
4. MRP run excluded for these materials
5. Every month end we did this transferred systemetically
Kamal