To run a SSIS package outside of SQL Server Data Tools you must install Move File to Archive of Integration Services or higher

Just to give future visitors something to look on, in my case issue was I had two different version of SSIS installed on same machine. One was for 2005 and another for 2014. And oddly enough even I was explicitly pointing to newer version (as shown in later part of post) in my command, it was always using old version.

Once I had clean system with just SQL Server 2014 (& SSIS) same package ran without any issue. So it appears a limitation of some sort which doesn’t allow to run two different versions of SSIS on same machine.

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