Test logs can not be created message

Hi,

When I run my test from command line, it gives below error message (Image 1) and tests doesn't run. I even removed all logs from the  project but still same message. 
Also, when i try to run the tests from TestComplete using Run-> Run tests by tags, I get the following popup (Image 2). Not sure why am i getting this test logs error.

Can anyone help me with this?

Thanks,

Pankhuri