If you're coming from the J2ME world, you'll be disapointed about Flash Lite Capabilities as regards the operating system.
Flash Lite is running in a virtual machine as you know, but unlike Java, only few methods are available to deal with operating system data/events.
"Suddenly, another application becomes foreground say a call comes then how it will be handled??"
As you know Flash was design to run "graphic animations", when Flash Player is put to background, the animation is simply paused.
However, I believe actionscript code is still processed even in background.
"Will the flash application knows this information?"
"In midlet we have something like hidenotify shownotify how we can handle this in flashlite ??"
According to the OS you're using, Windows Mobile or Symbian, you can combine Flash Lite with plugins ...
The basic method is often to communicate with a local server running in dotnet or java and processing operating systems data/events.
Janus-Flash (dead project I think) for Windows Mobile
Kunerilite for Symbian
Wait Flash Player 10.1 for mobile devices... along with AIR port, Adobe might offer more OS data/event handling in the Flash Player.