OnClientClick calls the function ShowPanel(); and then you have written "return false;". You are also returning false from the function. So, it can't fire the server side method.
The code should look like below...
<asp:Button id="btnSubmit" runat="server" Text="Submit" OnClientClick="javascript:return ShowPanel(); " OnClick="btnSubmit_Click"/>
<script type="text/javascript">
function ShowPanel() {
$('#divcontrol').toggle("slow");
return true;
}
</script>