Email Router Send Error "5.7.1 Client does not have permissions to send as this sender" using Local Service Account

Dear Team,

We are using Dynamics CRM 2013 and we are facing an issue during sending mails from activity. there are two scenario to sending mail.
1. Microsoft Dynamics CRM for Outlook
2. Server side synchronization or Email Router.

We are able to send mails from Microsoft Dynamics CRM for Outlook but when we select
Server Side Synchronization or Email Router  mails are not able to send.

We found some error on event viewer:
#61042 - An error occurred while processing the outgoing email message with subject "Testing 1234 CRM:0015026" for SMTP: https://ORG.xyz.com/ORG for delivery through 10.3.1.35. System.Net.Mail.SmtpException: Mailbox unavailable. The server response was: 5.7.1 Client does not have permissions to send as this sender
   at System.Net.Mail.MailCommand.CheckResponse(SmtpStatusCode statusCode, String response)
   at System.Net.Mail.SmtpTransport.SendMail(MailAddress sender, MailAddressCollection recipients, String deliveryNotify, Boolean allowUnicode, SmtpFailedRecipientException& exception)
   at System.Net.Mail.SmtpClient.Send(MailMessage message)
   at Microsoft.Crm.Tools.Email.Providers.CrmPollingSendEmailProvider.Run()  


It would be great help if some one help to resolved this issue.


Thanks,
Sidh