Hye karthick,
Pull up resistor used to keep the pin in stable state for no signal avaialble on line.
If you not connected pull up resistor then pin state should be fluctuate and change the state(i.e. 0 to 1 or 1 to 0) due to environment noice or some othe parameter. In case of I2C, if you not connected pull up with I2C device then start process will be not occured and communication is not happened. If controller has internal sufficient pull up resistor then no need to connect external pull up resistor but it is not reliable.
If you connected pull up resistor then pin state is in stable state and easily communication will start.