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i think the code should be
if(PWM1IR&0X01==0X01)
instead of
if(PWM1IR&0X10==0X10)
correct me if i am wrong
But as i said the interrupt flag "PWMCAP0" is available only in LPC2468(your micrcontroller)
but not in LPC2368(my microcontroller) thats why i m stuck. what flag to check if an event occurs.