Hi Tero,
thanks for your response. I believe the error was due to orphan privilege. The only privilege was in OK status but when trying to reprocess other privileges for the same repository its failing. The privilege which is I was re-provisioning was assigned as an orphan privilege to the identity. I have assigned the same privilege as an direct reference to the identity using the values as {e}DIRECT_REFERENCE=1}<%privilege%> and then removed the direct assignment which triggered De-provisioning task. Later when reprocessed the failed assignment it got successfully added.
Regards,
DP