ORA-15000: command disallowed by current instance type
Cause : The user has issued a command to a conventional RDBMS instance that is only appropriate for an ASM instance. Alternatively, the user has issued a command to an ASM instance that is only appropriate for an RDBMS instance.
Action - How to fix it : DBA Scripts :: www.high-oracle.com/scripts
Connect to the correct instance type and re-issue the command.
Well, the reason for above error is that i have taken the above script from a 11g database and running it on 10g database. 11g has bring some changes in password management. Below code is executed on 11g and user created successfully, which is expected result.