1. When I try to sign in it says Microsoft Account doesn't exists .
2.When I try to signup it says Microsoft Account already exists .
What is the matter with Microsoft. In the name of flexibility Microsoft made simple email usage as a complex
I now understand why no one uses this Microsoft account atleast in my country.

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Courtesy of JMH3143, (MS-MVP):

1.The error "Microsoft Account does not exist" usually means: *The person is logging in using an Alias.

*The person mistyped the email address. Retyped the correct email address.

*The person did not access the account with a Browser.

You must sign in to your Microsoft account periodically, at a minimum every year, to keep services associated with your Microsoft account active.

If you don't sign in during this period, we will close your account (which means you won’t have access to the Windows Services, Office Services, Content stored in your account, and any other product or service that uses Microsoft account).

2. If your account was marked inactive it would not exist. There is an additional 30 days before the security hold is cleared and during that time the email address will remain "taken"

At the end of that time you or anyone may be able to create a new account or an alias using the same email address. The data is gone however.