Kapil: you are trying to run a 3.4 kernel using the old fglrx package included 
with Lucid. That will not work (because fglrx needs patched to work with 3.4 
kernel).
If you want to manually build Catalyst for 3.4 kernel, see: 
http://ubuntuforums.org/showthread.php?t=1969827
(Of course, you will need to change 'Ubuntu/precise' to 'Ubuntu/lucid'

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which is subscribed to fglrx-installer in Ubuntu.
https://bugs.launchpad.net/bugs/1017233

Title:
  package fglrx 2:8.723.1-0ubuntu6 failed to install/upgrade: fglrx
  kernel module failed to build

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