I need to only get the line with the highest transactiontime per productId. So In this case I need to get the first line and all the other lines with productid 224 should be gon
As you said, grouping by NQ is what's messing your result up, because each row has a different value.
If you can assume that latest TransactionTime has lowest NQ value (which is true with the sample data you provided) you can just remove NQ from the group by and select min(NQ) instead of plain NQ.
SELECT min(NQ), ProductId, Product, Warehouse, ProductType, MAX(Transactiontime) as 'TransactionTime'
FROM @MaxTime
GROUP BY Productid, Product, Warehouse, ProductType
ORDER BY ProductId
I'm afraid that would be assuming too much, and if that's true you will have to use @HoneyBadger answer