My opponent conducted an amphibious assault consisting of one infantry and one tank supported by a fighter. I got two defensive hits. He wanted to remove the transport as one of the casualties. I argued that transports aren't really part of the attack and therefore can't be taken as casualties. Is this correct?
That would be correct. They can only be lost in the Naval battle in the first instance. Once the Land invasion begins only the air or land units can be taken as casualties. Even when a battleship is involved it can not be attacked.