ajay,
Try restoring your computer to an earlier date by running Restore from the command prompt. You're saying it boots in Safe Mode with Command Prompt...
1) Type the following command at a command prompt, and then press ENTER:
%systemroot%\system32\restore\rstrui.exe
2) Follow the instructions that appear on the screen to restore your computer to an earlier state.
After the system restore is performed. Make sure you reboot the computer.
See if this will stop the computer from booting into Safe Mode with Command Prompt. If it does...then do the following to check your system for malware:
1) If the computer boots normally after performing the above...then the first thing we want to do is turn off System Restore. You can do this by going into your Control Panel, open System Properties, select the System Restore tab, and then check the box to turn off System Restore. Click Apply and/or OK.
2) Once you have turned off System Restore, reboot your computer into Safe Mode only.
3) Run Spyware Doctor and fSecure to remove unwanted malware.
4) Reboot into Windows, normally, and turn System Restore back on.
Post your results here.