There many cases where script Manager may give problem like that. you Try This First add Script Manager in appropriate Placeholder or any place Holder which appears before the content in which Ajax Control is used.
We need to add ScriptManager while using any AJAX Control not only update Panel.
<asp:ScriptManager ID="ScriptManger1" runat="Server" />
If you are using Latest Ajax Control Toolkit (I am not sure about version 4.0 or 4.5) you need to use that Particular ToolkitScriptManager and not ScriptManager from default Ajax Extensions.
You can use only one ScriptManager or ToolKitScriptManager on page, If you have added it on Master Page you no need to add it again on Web Page.
The problem mentioned here may because of ContentPlaceHolder Please Check how many content place holders you have on your master page. Lets take an example if you have 2 content Placeholders "Head" and "ContentPlaceHolder1" on Master Page and ContentPlaceHolder1 is your Content Page.please check below code I added here my ScriptManager on Second Placeholder just below there is update panel.
<!DOCTYPE html>
<html xmlns="http://www.w3.org/1999/xhtml">
<head runat="server">
<title></title>
<asp:ContentPlaceHolder id="head" runat="server">
</asp:ContentPlaceHolder>
</head>
<body>
<form id="form1" runat="server">
<div>
<asp:ContentPlaceHolder id="MainContent" runat="server">
<asp:ScriptManager ID="ScriptManger1" runat="Server" />
<asp:UpdatePanel ID="UpdatePanel1" runat="server">
<ContentTemplate>
</ContentTemplate>
</asp:UpdatePanel>
</asp:ContentPlaceHolder>
</div>
</form>
</body>
</html>
Most of us make mistake while designing web form when we choose masterpage by default on web page there are equal number of placeholders as of MasterPage.
<%@ Page Title="" Language="C#" MasterPageFile="~/Master Pages/Home.master" AutoEventWireup="true" CodeFile="frmCompanyLogin.aspx.cs" Inherits="Authentication_frmCompanyLogin" %>
<asp:Content ID="Content1" ContentPlaceHolderID="head" Runat="Server">
</asp:Content>
<asp:Content ID="Content2" ContentPlaceHolderID="MainContent" Runat="Server">
</asp:Content>
We no need to remove any PlaceHolder it is guiding structure but you must have to add the web form Contents in Same PlaceHolder where you added your ScriptManager(on Master Page) or add Script Manager in appropriate Placeholder or any place Holder which appears before the content in which Ajax Control is used.