Here is the info of what i have done
 
Desktop Pc:
1. Windows Xp Pro.
2. Connected to Internet using Cable Modem which is connected to the PC through USB
3. Lan Card
4. Lan Card connected to Router
5. Lan IP 192.168.0.2 subnet 255.255.255.0
 
 
LAPTOP
1. Connected to Router wirelessly
2. TP-Link Router IP 192.168.0.1
3. DHCP disabled
 
rest is all automatically configured.
 
Everything is working fine except i am getting this error on desktop
 

 
please help

Why don't you just connect the router to the cable modem instead of trying to use ICS?
 
Grumpy

because i want to use my desktop as server.

Server for what? You're just making it more complicted then it needs to be.
 
Grumpy

Do you have ethernet ports on the cable modem ?

Disable DHCP on your desktop, and use a static IP. Your router is on a different network than your desktop/laptop.
 
That said, you do want to connect your cable modem to your router, and connect each computer to the router. Cable modem to desktop via USB and using ICS is kinda silly. You can use your desktop for any server duties you wish, you'll just need to configure port forwarding on your router.