"Contact says that:
"The company reserves the right to transfer employee to india at any time."
but at the same time the contract says that
"either party can terminate the employment by giving 8 weeks notice"."
you refuse to go back to India, he has the right to cancel your working contract then. however it will be a normal "ordentliche Kündigung", which will not affect your right on unemployment benefit
"Now there are two possibilities:
##1 My employer accepts my resignation:"
he will gladly do that if he wants to see you in India, DON'T DO THAT! if you do such a stupid thing, the unemployment benefit will not be paid to you during first 12 weeks of your unemployment (6 weeks if you can prove that such a decision will create you big difficulties). moreover, if it is 12 weeks, the period of time, during which you are eligible to get an unemployment benefit, will be shortened to 3/4. in your case that would mean: 9 months instead of 12.
"b) Can my employer refuse to process my unemployment benefit form.I mean is it lawfully possible to do so by an employer."
he can of course, then you need to go to your local employment office and submit there an application for "Amtshilfe" for getting a required form; argumentation - your employer refuses to give it to you. after that your employer is going to have a lot of fun, he even may get in jail until he agrees to issue such a document *lol*
"##1 My employer doesn't accepts my resignation:
!!!! Even I am not sure about the implication of this.Please give me some expert comments."
you can get his signature on a copy of cancellation notice, if he refuses, you can get witnesses to sign under a statement that he refused to get your cancellation notice - with signatures of witnesses it is valid even if he did not get it. if you can not find witnesses, send it to him by post as "Einschreiben", add up 4-5 days to 4 weeks for delivery when you calculate the end date of your working relationship
but DON'T DO THAT, otherwise you are going to loose your unemployment benefit during 12 (or 6 if you are lucky) weeks. better let him cancel a work contract ;)
"If I get unemployment benefit then for how may months because i heard that for some states its limited to 6 months and for some its in proportion with the duration of employment."
it depends on you and you alone, more specifically - on how you can defend yourself ;)