Hi Suhas,
Based on your updates, please try the following steps to check if the issue persists:
1.Try to use Outlook 2013 to check if you have the same error.
2.Create a new profile for your Office 365 account in Outlook 2010, and try reconfiguring it.
If you have any news about the tests above, please share them with us.
Thanks,
Edmond Peng