Champaka, also known as Golden Champa or Yellow Champak is not used in the worship of Lord Shiva. The two flowers that are regularly avoided are Ketaki flower and Chempaka flower. There is an interesting story in the Shiv Purana which explains the reason why Champaka flowers are not used in Shiva Puja.
On the way to Shiva Temple
After Narada left for the temple, the Brahmin plucked the flowers in a basket and hid it.
On return from the temple, Sage Narada again met the Brahmin and this time he told that he was going home. But suspicious about this behavior, Sage Narada went and asked the Champaka tree did anyone pluck your flowers. The Champa tree said 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 evil Brahmin daily comes and showers the Shivling with champa flowers. Lord Shiva is pleased with this act and due to His blessings the Brahmin 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 told that 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.
You may also like to read