diff --git a/modules/core/src/main/java/org/apache/synapse/Axis2SynapseController.java b/modules/core/src/main/java/org/apache/synapse/Axis2SynapseController.java
index ace8f3b..cece905 100644
--- a/modules/core/src/main/java/org/apache/synapse/Axis2SynapseController.java
+++ b/modules/core/src/main/java/org/apache/synapse/Axis2SynapseController.java
@@ -475,6 +475,18 @@
      * @return SynapseEnvironment instance
      */
     public SynapseEnvironment createSynapseEnvironment() {
+        synapseEnvironment = new Axis2SynapseEnvironment(
+            configurationContext, synapseConfiguration, serverContextInformation);
+        MessageContextCreatorForAxis2.setSynEnv(synapseEnvironment);
+
+        Parameter synapseEnvironmentParameter = new Parameter(
+            SynapseConstants.SYNAPSE_ENV, synapseEnvironment);
+        try {
+            configurationContext.getAxisConfiguration().addParameter(synapseEnvironmentParameter);
+        } catch (AxisFault e) {
+            handleFatal("Could not set parameter '" + SynapseConstants.SYNAPSE_ENV +
+                "' to the Axis2 configuration : " + e.getMessage(), e);
+        }
 
         try {
             deploySynapseService();
@@ -485,20 +497,6 @@
             throw new SynapseException("Synapse startup failed", axisFault);
         }
 
-        synapseEnvironment = new Axis2SynapseEnvironment(
-                configurationContext, synapseConfiguration, serverContextInformation);
-        MessageContextCreatorForAxis2.setSynEnv(synapseEnvironment);
-
-        Parameter synapseEnvironmentParameter = new Parameter(
-                SynapseConstants.SYNAPSE_ENV, synapseEnvironment);
-        try {
-            configurationContext.getAxisConfiguration().addParameter(synapseEnvironmentParameter);
-        } catch (AxisFault e) {
-            handleFatal("Could not set parameter '" + SynapseConstants.SYNAPSE_ENV +
-                    "' to the Axis2 configuration : " + e.getMessage(), e);
-
-        }
-
         synapseEnvironment.getTaskManager().init(taskDescriptionRepository, taskScheduler);
         synapseConfiguration.init(synapseEnvironment);
         synapseEnvironment.setInitialized(true);
@@ -778,7 +776,9 @@
                         configurationContext.getAxisConfiguration());
                 if (proxyService != null) {
                     log.info("Deployed Proxy service : " + proxy.getName());
-                    if (!proxy.isStartOnLoad()) {
+                    if (proxy.isStartOnLoad()) {
+                        proxy.start(synapseConfiguration);
+                    } else {
                         proxy.stop(synapseConfiguration);
                     }
                 } else {
diff --git a/modules/core/src/main/java/org/apache/synapse/core/axis2/ProxyService.java b/modules/core/src/main/java/org/apache/synapse/core/axis2/ProxyService.java
index 3796295..4b500a0 100644
--- a/modules/core/src/main/java/org/apache/synapse/core/axis2/ProxyService.java
+++ b/modules/core/src/main/java/org/apache/synapse/core/axis2/ProxyService.java
@@ -577,7 +577,6 @@
                     axisCfg.addServiceToExistingServiceGroup(proxyService, serviceGroup);
                 }
             }
-            this.setRunning(true);
         } catch (AxisFault axisFault) {
             try {
                 if (axisCfg.getService(proxyService.getName()) != null) {