The problem is probably that you are using a bare word instead of a string. Try changing: 
$VAR = TEMP_VAR

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to 
my $VAR = "TEMP_VAR";

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and it should work. My quick test with a Perl one-liner under Unix: 
$ echo 'create variable $VAR alarm_object 0' | perl -e '$VAR = "TEMP_V
+AR"; while (<>) { chomp; eval (qq{print  "$_\n";});}'
create variable TEMP_VAR alarm_object 0

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My understanding is that this is closer to what the OP wanted than s///, but I may of course be wrong.

In reply to Re: Substituting Variables while reading text file by Laurent_R
in thread Substituting Variables while reading text file by mohanm_eee

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