Do i need to change the /etc/fstab file?

Yes

Change all hdc references to hdb. This is what I would expect to be reported if the 40Gb drive is slave on the primary IDE.

Thank you all for your replies and advices.

As mentioned in one of the reply I changed all the hdc references hdb in the fstab file. Similarly, changed the kernel line from /dev/hdc1 ro to /dev/hdb1 ro in the menu.1st file.

THE PROBLEM GOT SOLVED!! I am able to boot from 40GB HDD without any issues.

title Debian GNU/Linux, kernel 2.6.18-6-686
root (hd0,0)

initrd /boot/initrd.img-2.6.18-6-686
savedefault

So grub is working then, that bit's all right.

Try changing kernel /boot/vmlinuz-2.6.18-6-686 root=/dev/hdb1 ro to root=/dev/hda1 (which is what I meant to say above). In unlikely event it doesn't work try various fiddlings with file and are you sure 250 is formatted as ext3, not ext2 perhaps - fdisk -l.

just do not put cdrom in primary IDE master. move it to slave, preferrably secondary.
this way you will avoid this mess with grub setup.

Sorry cocked up above. Difficult to diagnose stuff at a distance like this.

title Debian GNU/Linux, kernel 2.6.18-6-686
root (hd0,0)
kernel /boot/vmlinuz-2.6.18-6-686 root=/dev/hdb1 ro
initrd /boot/initrd.img-2.6.18-6-686
savedefault

Should think that's correct. The problem now is that the OS thinking the first drive is the bigger hd is trying to mount it, like it used to mount the smaller.

So you're right /etc/fstab needs changing. Just replace all the hda's with hdb's.

For completeness. If we were talking sata drives: If small hd was in sata plug 1, and big hd -> sata 3; and cdrom-drive -> sata 2; then swop over the big hd and the cdrom-drive - their plugs. Then no need to fiddle with files (at least with Debian). Same thing may work with ide plugs or whatever they are called.