NS_ERROR_FILE_ACCESS_DENIED error when Firefox Addon is installed the second time

Question

We have the Firefox Addon (the .xpi file) hosted locally. The xpi file is downloaded from the Mozilla Addon developer hub and put on our server.

When we install the Addon from the browser, the first time there is no error. Tho, before the Addon is installed there is a prompt that says "Firefox prevented this site from asking you to install software...". When I allow the Addon it installs properly.

But after the Addon is removed and installed again it logs the following errors in the browser's console:

1523369438217 addons.xpi WARN Failed to remove temporary file C:\Users...\AppData\Local\Temp\tmp-7i8.xpi for addon https://www........com/BrowserExtensions/FF/pulselinks_window_launch-1.0-fx-windows.xpi: [Exception... "Component returned failure code: 0x80520015 (NS_ERROR_FILE_ACCESS_DENIED) [nsIFile.remove]" nsresult: "0x80520015 (NS_ERROR_FILE_ACCESS_DENIED)" location: "JS frame :: resource://gre/modules/addons/XPIInstall.jsm :: removeTemporaryFile :: line 1493" data: no] Stack trace: removeTemporaryFile()@resource://gre/modules/addons/XPIInstall.jsm:1493 startInstall/<()@resource://gre/modules/addons/XPIInstall.jsm:1845

Any idea what might be causing the issue?

Firefox latest version

Windows 7 and 10