HI Amlan, thanks for your suggestions. Basically we want the taxes to applied based on the Account Determination ID, so if the account is tax exempt, the configured charge should be posted without taxes. It seems like during the posting of charges from disconnection it is always getting posted as gross amounts. The main configuration setting did not have any influence in this behaviour. However the issue was resolved by enhancing event 1110 with a simple code change of setting the gross/net posting indicator (I_XNETT).
Thanks a lot for your help!
Prashant