Champaka, or Yellow Champak is not used in the worship of Lord Shiva.Here is the story andreason why it is not used.
A beautiful Champaka tree withfull of flowers stood near Lord Shiva's Temple in Gokarna . Sage Narada once on his way to temple noticed this tree and admired it.One day he found a Brahmin who came to pluck the flowers, but when he saw Narada he refrained from doingit.
Sage Narada asked the Brahmin about his where aboutand why did he refrained from plucking the flowers then the Brahmin answered him that he was on his way to a nearby village and just stood their enjoying the Fragrance of Champaka tree.
Narada went to temple and when he returned he observed again the Brahmin plucking andthis time he hid those flowers in a basket . So, Sage Narada approached the Champaka tree and asked it whether anyone plucked its flowers,which answered "NO".
But still Sage Narada had his doubts so he went back to the temple and found that the Shivling was covered with Champaka flowers. Sage Narada asked a man who was meditating nearby as to who offered this flowers to Lord Shiva. The man told that an evilBrahmin daily comes and showers the Shivlingam with champak flowers.
Lord Shiva is pleased with this act and due to His blessings theBrahmin has become very powerful in the King’s court and now harasses poor people. The Sage Narada went to Lord Shiva and asked why he is helping the bad man. Shiva toldthat I cannot deny a devotee who worships me with Champaka flowers. Sage Narada went back to the Champaka tree and cursed it for lying to him. He said that the champa flowers will never be accepted in worship of Lord Shiva. He also cursed the evil Brahmin to be born as demon and will attain only moksha when Lord Ram kills him.
It is said that Ketaki Flower is cursed by Lord Shiva. This goes like this ,
Once Lord Brahma and Lord Vishnu got it into a fight over who is supreme. To sort out the issue Lord Shiva made His first appearance in the form of Jyotirlinga or Lingodabhavamurti (a column of fire with no end or beginning) before Lord Vishnu and Lord Brahma.
Lord Shiva intervened in the fight and said whoever can find out the origin or end of the Shivling is superior. Lord Brahma and Vishnu set off to explore the beginning and end of the mighty column of light.
Vishnu went down in the form of a boar and Lord Brahma went up in the form of a swan. Lord Vishnu was unable to find the base and came up and admitted defeat.
Brahma on his journey upwards came across a Ketaki flower. Brahma again went up but was unable to find the uppermost limits. So He decided to take the help of the Ketaki flower. Brahma decided to take the Ketaki flower back to Vishnu to bear witness that he had reached the top of the pillar of light. Brahma said he found the Ketaki flower atop the Jyotirlinga and ketaki supported it .
This lie infuriated Shiva. Brahma was cursed that for telling lie, He would not be worshiped on earth by people. Similarly, ketaki was also cursed that she would never again be used in worship of Shiva.
Thus, ketaki is not used for pujas and worship of Lord Shiva.