Query approved.

Try getting rid of the air filter and reverting to stock, check your camshaft bearings.

can you elaborate the problem?
is the throttle response uptilll 4000 rpm still as good as when newly modified? I mean a slight drop of response is ok, but is the drop too high?
how is the idling? is it steady? how long does the bike take to stablise the rpm?
when you blip the throttle, does the rpm drop gradualy? to be precise, can you post the timings for rpm drop from 4500 to 2500 rpm? blip the throttle and then check the timings with a stop watch... do this with a warm engine.. and also with cold engine..

does the engine feel flat after 6000 rpm? i.e does it seem to accelerate slowly after 6000?

also, find a highway, cruise steadily at 70 kmph on top gear. mark the throttle position. now downshift by one gear drop the throttle and again postion it at the earlier marked position. my how much does the KMPH increase? or does it drop?

The throttle response upto 6K rpm is the same as before the problem begins at about 6.5K rpm the tachometer needle starts vibrating from 7000 to 9000 rpm and looks like a thick band also the engine sounds harsh as if it will explode. Have to check the condition of the Cam bearing since the sound at idling is clickety(I can hear "tik-tik" sounds) as if the tappets are loose although I had tightened them maybe the main culprit is the cam's bearing as Pavan pointed out,also noticed that the rear wheel has shifted a bit to the left when I changed the sprocket this may be another culprit.
@Pavan I can't revert back to stock anytime soon cos the idiot mechanic who installed the ff filter cut the airbox and the new one costs 850 bucks.But the af mixture may not be incorrect as you suspect cos the spark plug does not show indications of burning lean or rich it's colour is dark brown. I will check the engine deceleration time from4.5K to2.5K rpm and the downshift speed readings and let you know ASAP

Your bike reaches 145 in neutral? That's scary buddy :O

Since you have a Free Flow Filter,try upjetting and retune your carb

It sounds to me more serious than a bad air filter. You've had the block shaved and head work done, and now less than three weeks later the engine won't cross 7000rpm? Sounds to me more like a bad head gasket, especially since you say there is a harsh sound when you get up near the higher rpms (the sound of the cylinder contents escaping through the head gasket). At a guess, the head gasket has cracked, and when you reach the 6500/7000rpm range the cylinder pressure is enough to push through the crack. The worse alternative is that the shop that did the machine work didn't do it carefully, and took too much metal off something, thus weakening it. If this is the case, it may be that it was the repeated high rpms that eventually caused the crack (which shouldn't happen, just explaining why this didn't show up immediately).

First, examine the base of the cylinder head carefully. You may be able to see some carbon deposits on the gasket, which would indicate where the gasket is cracked. Alternately, the head itself may be cracking as a result of having the valve seats dropped. If that's the case, only a compression check will show anything without pulling the head.

I would take the bike back to the shop where you had the work done, and have them pull the head and check their work. If, as I think, something went wrong, it's their responsibility to make it right at their expense.

The problem has started after almost two months.So I don,t think the shop will claim responsibility. Also found out that the cam's bearings are badly worn out, one more reason is that I had connected both the breather pipes to a T-joiner and put the hose from the free end into the intake pipe(It is the one beetween the stock airbox and carb) by the removal of the tiny plastic air reservoir in the intake manifold. the hot air from the crankcase going directly to the engine may also have contributed to the loss in performance.I have set the pipes right and put the air reservoir back in place Now the engine seems better and goes upto 9K rpm. I will however check the condition of the gasket for spotting leaks so that problems if any can be detected in advance before they become too severe.
(@Atul You seem to have an apache 150. FYI the RTR series have a feature that automatically registers the top speed and quickest 0-60 timing, so if you can see under the numbers of the speedo HI SPD is displayed which can be accessed by using the mode selection switches.So it's not that scary in neutral.) Still, doing 145 in neutral would be scary if it were to really happen.

Good that VIgnesh's bike doesnot have a REVERSE gear, else he could have also done 145 in opposite vector

Jokes apart - thats the advantage of digital console, its like a mini computer and records vital information... and also barriers playing with clocks (KMS done) on the console which in UK is a serious offence.

It is one of the RTR many features. RTR can record the topspeed acheived and the fastest 0-60 km/hr sprint.

If the problem is directly related to the work they did, i.e. too much metal taken off a casting thus weakening it so it cracks, reused head gasket, etc, then the problem is theirs even if it took time to appear. Granted it will be harder to prove due to the amount of time that has passed, so you have to be willing to eat the cost if it turns out it's not their fault, but since you need to solve the problem anyway, it would be worth checking out.