Hi Gopish,
I have connected an MCP4631 digital potentiometer with both SCL and SDA lines pulled up with 4k7 resistors. The SCL and SDA lines are initially high and the SDA line is pulled low after setting the ST bit. The P0 clock is 32.5MHz, CKS = P0/8, BRL = 19, BRH = 16 (it is not clear to me yet what the BRL and BRH values exactly represent). I have tried the initialization cycle as you suggested, but that does not make a difference (for now at least).