The problem was occurring due to the supplied modem manger from vendor,
I uninstalled the vendor's modem manager and the problem solved, the
system recognises the device and activates mobile broadband option in
network-manager applet.

** Changed in: network-manager (Ubuntu)
       Status: New => Invalid

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https://bugs.launchpad.net/bugs/1590771

Title:
  Mobile Broadband does not activates after inserting usb modem in
  Xubuntu 16.04.

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