sushant:
i used the I2C scanner from herehttp://arduino.cc/playground/Main/I2cScanner, the scan suggests that device is connected at 0x38 but still i'm not getting any display on the LCD using this address?
Have a look in this folder: \Arduino-1.0\libraries\LiquidCristal_I2C\info
It has a nice picture called schematic_diagram. The examples in the library are based on this schematic.
One significant difference with the example you started off is the connection of E , RS and R/W to the PCF.
So, please wire your display as in the schematic and have another go. Forget about the backlight for now, just connect to Vcc and GND (with a resistor of course)