In one of my projects i was using a 16X2 lcd display with ATmega 328P micro controller, its failing in EFT test at 2kv and 4kv, its not resetting the micro controller but the screen goes gibberish, it seems like the data lines from micro controller are getting effected, it would be great if you guys can help me out for any possible fixes
You should show an instrument photo to make as understand how burst injected to power lines affects the LCD display. A common situation is that either LCD metal frame couples to the instrument case or is connected through a cable so that common mode noise can easily generate false write commands to the LCD controller.
If simple measures like common mode ferrites don't help and you don't want to redesign the LCD mounting and interface, you should consider to comply with acceptance criterion B: self-recoverable temporary loss of function. Presumed the LCD interface provides read functionality, you can periodically check the LCD health status, e.g. by reading back the display data RAM and re-initialize the controller in case of failure.