Resolution: Steps to explain the behaviour:
1). Create a domain without any password policy.
2). Login to the domain with the admin user. Set the password policy as Normal Policy. Then restart Admin.
3). Login in back as admin and change the password policy to Strong policy, create a new user with this policy.
4). Logout from admin and try to login with the newly created username and password.
- It should ask for changing the password to a new one instead of logging in without prompting for changing the password.
5). Design behaviour: In order to ask for resetting password at login, Admin has to be restarted after applying a new password policy.