I hope that if it EOSC , the bit which you told is responsible for Oscillator ON/OFF mode, is 1 will not damage the Oscillator or DS1337. Earlier it was 1, but now i changed it to 0.
#define DS1337_SP 0x0E
#define DS1337_SP_EOSC B00000000
#define DS1337_SP_RS2 B00010000
#define DS1337_SP_RS1 B00001000
#define DS1337_SP_INTCN B00000100
#define DS1337_SP_A2IE B00000010
#define DS1337_SP_A1IE B00000001
But still the same result.I again tried changing the oscillator, but no results.