Ok guys heres the update.
The sensor I had been talking about wasn't CKP instead it was TDP (Top Dead Point) sensor. After changing the sensor, we took the car out for a test drive (cng+ac), and just after like 5 KM, the temperature bar would show over heating. I stop the car and park it on a side, turn the ac off and keep the engine running, the temperature came back to normal in 5 min.
Back in the workshop after the 1st test drive we had to fill up around 500 ml of water in the radiator. The mechanic checked for any leaks but didn't find any. After that we took the car out for another test drive, and this time we drove over 30 KM (cng+ac), without the car showing a little sign of over heating. So I was happy that the problem had finally been resolved. I made the payment. On my way back home, after a while the car would again start over heating, as soon as the temperature bar would cross half, I turned the AC off(just the AC and I keep on driving), and the temperature came back to normal in 2-3 minutes. When the temperature would come back to normal I would again turn the AC on, and I tried the routine like 6-7 times, and each time the same behaviour. Reaching home, and letting the car cool down, I had to put around 1 Ltr of water in the radiator again :-s
So I know that I have been writing very lengthy descriptions, but I would just like to know what might be the problem that the temperature would stay normal without AC and with AC the car would loose water and eventually temperature would rise.
Thanks for your help,