I am unable to start any program from System32. Eg. Advance System Settings, Task Manger etc. I am getting the Error as - The filename, directory name or volume label syntax is incorrect.
You mean the system32.ini file? A shot in the dark here, but has an entry in there got a 'wierd' character? read this to see what characters can't 'run'.
If it happened recently, and something changed a path entry in the system32.ini file, perhaps rolling back to an earlier Restore Point would fix it by restoring the older (working) system32 ini file.