1. Turn the settings to the minimum. Does it run smoothly now? If yes, try enabling more settings one by one until it starts to stutter again and back off.
2. Paradise City is based on an older engine that doesn't have high computer requirements.
3. Your graphics card is a weak laptop version of an already weak desktop card. The low RAM for your GPU is probably getting overloaded by the textures and objects. The best way to overcome this is to reduce line-of-sight. I don't know if either of those games have that option, I don't play either of them, but that reduces amount of textures and polygons your RAM stores.
4. No work-arounds. A laptop's GPU isn't upgradeable. What you have is what you have, unless you return it and buy something more powerful. Kinda sux for you, cause 40k INR (~$850) could buy you a decent desktop and you wouldn't have those problems.
If the problem is with the graphics card,
the same thing happens with my 1gb nvidia geforce
1. I've tried what you've said assassin's creed works properly at high graphics, gta4 still doesn't.
2. As for gta4, it works retarded at even the least amount of graphics
Simply saying you have a 512MB or 1GB video card does not help. You need to provide the exact model like the Mobility Radeon HD 4550 which is probably what you have. That is a very weak card.
GTA 4 was originally developed for game console. It was ported over to the PC, but it is a poor port so it has some pretty high requirements on the PC. There is nothing you can really do if running the game on the lowest settings does not work. You cannot upgrade the video card in laptop unless it is one of those rare gaming laptops that allows you to upgrade the video card. However, those usually cost over $1,500 USD.