Many people think that it HO allotment who is responsible for Degrading a WL/CNF ticket in to WL/WL status.
This is not correct.
No charting location can change quota number except when a Extra coach attached.
The common reason for such down grading (and it happens with AC class mostly) is:
Last...
more... minute removal of Coach at "washing pit" called 'coach certified as Damaged' in Rail lingo. and unavailability of spare coach (specially AC coach.
This results reCharting (some time) or Charting minus damaged coach.
No other valid reason exists for this unfortunate scenario.