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Here is the error am getting while trying to create a user. This is a new set up it was working in my previous set up.
I have installed same exchage version and control panel works fine with AD but unable to create mailbox:-

ystem.Exception: Error executing ‘CREATE_MAILBOX’ task on ” EXCHANGE —> System.Web.Services.Protocols.SoapException: Server was unable to process request. —> Cannot bind parameter ‘PrimarySmtpAddress’. Cannot convert value “machalePublicFolderMailbox@” to type “Microsoft.Exchange.Data.SmtpAddress”. Error: “You can’t forward email to “machalePublicFolderMailbox@” because the address format isn’t correct. Please enter an email address with this format: user name, the @ sign, followed by the domain name. For example, tonysmith@contoso.com or tony.smith@contoso.com.” —> Cannot convert value “machalePublicFolderMailbox@” to type “Microsoft.Exchange.Data.SmtpAddress”. Error: “You can’t forward email to “machalePublicFolderMailbox@” because the address format isn’t correct. Please enter an email address with this format: user name, the @ sign, followed by the domain name. For example, tonysmith@contoso.com or tony.smith@contoso.com.” —> You can’t forward email to “machalePublicFolderMailbox@” because the address format isn’t correct. Please enter an email address with this format: user name, the @ sign, followed by the domain name. For example, tonysmith@contoso.com or tony.smith@contoso.com. at System.Web.Services.Protocols.SoapHttpClientProtocol.ReadResponse(SoapClientMessage message, WebResponse response, Stream responseStream, Boolean asyncCall) at System.Web.Services.Protocols.SoapHttpClientProtocol.Invoke(String methodName, Object[] parameters) at WebsitePanel.Providers.Exchange.ExchangeServer.CreateMailEnableUser(String upn, String organizationId, String organizationDistinguishedName, ExchangeAccountType accountType, String mailboxDatabase, String offlineAddressBook, String addressBookPolicy, String accountName, Boolean enablePOP, Boolean enableIMAP, Boolean enableOWA, Boolean enableMAPI, Boolean enableActiveSync, Int64 issueWarningKB, Int64 prohibitSendKB, Int64 prohibitSendReceiveKB, Int32 keepDeletedItemsDays, Int32 maxRecipients, Int32 maxSendMessageSizeKB, Int32 maxReceiveMessageSizeKB, Boolean hideFromAddressBook, Boolean isConsumer, Boolean enabledLi……………..