Thanks you all for your response.
Actually the issue is with the tool I am using.. It picks the server where it found the @. It consider as a server after @.
/Q c:\eqsys.txt sftp://v556837:Case@123@server1
In above case it picks 123 as hostname instead of server1.
I don't have any issues if password not used special character like @, $, % in between.
Regards,
Anand Mathan.