As it turned out this is not a general problem. This was due to “User Role Editor” plugin itself so people not using subject plugin may not face such an issue.
Anyways, author of “User Role Editor” plugin has now provided a solution to circumvent this default behavior here. So, one has to use following code snippet:
add_filter ('ure_not_block_other_roles_for_local_admin','my_not_block_other_roles_for_local_admin');
function my_not_block_other_roles_for_local_admin($flag) {
return false;
}
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