Hi Charan,
Not all native COBOL programs can be moved to managed code as is. Most programs that use standard procedural COBOL language constructs can be moved without a problem.
Programs that use features such as the native OO syntax or class library support of Net Express, i.e.OLE class library, are not supported directly in managed code and would require some coding changes.
Calling a .NET Web Service from a managed client is much easier than doing this from a native client. You do not use the COM layer but simply add a Web Reference of the web service directly to your client project and instantiate the class.
I would suggest that you look in the Samples Browser under category Web Applications and Windows Communication Foundation for examples of this.
I am not sure what is causing the COBOL.DIR not found error. Are you setting the COBDIR environment variable within your project? Does this only happen when you are turning on ilsmartlinkage? How are you turning on ilsmartlinkage, project properties, program level, etc?
What other directives are you setting?
Thanks.