WordPress /page/2 gives 404 when custom permalinks is set to %category%%postname%

My wordpress permalink settings,

Custom Structure: %category%%postname%.

Used next_posts_link() in custom theme in archive.php to get next posts link.

Result:
Next Page >> (display as expected)

But when i click the link it redirects correctly to mysite.com/my_category/page/2. But it results in 404.

Any advice would be appreciated.