Getting 500 error from the WinRM client and see WSMan operation CreateShell failed in eventlogs

Question

I am seeing 500 errors on the WinRM client and see "WSMan operation CreateShell failed errors" under EventLogs. I tired all below and nothing helped:

Reconfigured WinRm by deleting the listeners and running the quickconfig

Checked and validated the firewall rules

Disabled and enabled WinRm using sconfig

All I need is just the HTTP listener working on default port nothing special. Test-WSMan results are successful, however the issue is with using PowerShell script on the same server or from different client both result in to 500 error and see "WSMan operation CreateShell failed" in Windows Remote Management event logs.

Any help?