I have 8gb transcend pen drive i have 7 gb of data in it now it is showing 0 bytes as capacity & used space. The name has been changed to removable disk & when i click on it i get a message "removable disk not formatted format it now".

Flash drives can become faulty if they are not removed from the USB port correctly.
Please click on this link and follow my instruction to restore your flash drive :-
http://www.fixya.com/support/r3598107-faulty_usb_flash_drives

Here are several data recovery sites and programs that may help to recover data from faulty flash drives
http://www.jufsoft.com/badcopy/flash_drive_recovery.asp
http://www.eprovided.com/usb-flash-drive-data-recovery.html
http://www.freedownloadscenter.com/Utilities/File_Maintenance_and_Repair_Utilities/USB_Flash_Drive_Data_Recovery.html
http://www.softpedia.com/get/System/Back-Up-and-Recovery/USB-Flash-Drive-Data-Recovery-Software.shtml

It sounds like your media is malfunctioning (controller issue).
Our company, LC Technology, is the only Sandisk-approved
data recovery company and we have been working on their products
for over 5 years. You simply have to send your media to us.
Our technicians will recover your files on CDs and return everything
within 48h. You just need to send us your Sandisk with this form:
http://www.lc-tech.com/documents/LC_Technology_Data_Recovery_Service-SD-Eric.pdf

There is a charge for this service, but ONLY if we
are successful. The pricing is on the form. Please note
that the chances of recovery are around 90%.

Eric Beaudoin
[email protected]
1-866-603-2195 ext 103
LC Technology International