Hi Sathi,

Can you comment if this is still an issue for you?  Examining your
DpkgTerminalLog.gz file I saw the following.  Had you uninstalled grub?

Searching for GRUB installation directory ...

No GRUB directory found. To create a template run 'mkdir /boot/grub'
first. To install grub, install it manually or try the 'grub-install'
command. ### Warning, grub-install is used to change your MBR. ###


User postinst hook script [/sbin/update-grub] exited with value 1

dpkg: error processing linux-image-2.6.27-14-generic (--configure):

 subprocess post-installation script returned error exit status 1

** Changed in: linux (Ubuntu)
       Status: New => Incomplete

-- 
linux kernel update crashed when installed from Synaptic Package Manager
https://bugs.launchpad.net/bugs/376809
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