LTC4412 Power switching Issue

We are using LTC4412 for power supply switching between 12V SMPS power Supply (PWR_IN)  and 7.4V Li-ion Battery Power Supply (BAT_V).The Block diagram and the schematic of the power supply and switching unit has been attached.
When I connect the AC power supply and switch, I have found the SMPS output (PWR_IN) as 12VDC and the battery is charging. But, the VIN/2 (shown in schematic) is Zero  and the internal circuitry is not working.
But while I removed the AC power Supply, voltage at  VIN/2 is found as the battery voltage (BAT_V) as expected and the internal circuitry is working fine.
What could be the problem that when the PWR_IN is present, the LTC4412 is not allowing the voltage to the internal circuitry. (Remember: when I remove the SMPS(PWR_IN =0V), the LTC4412 is allowing the BAT_V voltage to internal circutry). Why the LTC4412 is behaving like this? What could the possible reason of it?