GOT IT WORKING!!!

I went to Nokia Support Discussion and tried one of the suggestion. For the benefit of those having the same problem:

Problem:
Launching Application Manager = Error : "Operation failed"
Checking for updates = Error: "Operation failed"
Download option = "(no applications available)"
Try to install apps from Ovi Store = Error : "Unable to download '(apps)'. Application package not found"

Solution:
Disable all application catalogues - autorun check updates
Enable all application catalogues
Done!