@girish, what parity in general or how it applies to RAID?
So in general its used as a way to validate data against corruption, tink of the bits in a byte, use 7 bits for data and 1 for parity and we use a scheme whereby the number of “1″ bits is always odd so 0000001 gets a parity bit of “0″ (00000001), whereas 0000011 gets a parity bit of 1 (10000011)
With regard to RAID the parity data stored is the XOR of all the data on the data disks. This paity data means that if you lose one disk the data on that disk can be recovered by XOR’ing all the other data which leaves the missing data (see an explanation here on wikipedia http://en.wikipedia.org/wiki/RAID#RAID_parity