Me and a colleague of mine spent a complete day with this error last week. There are several possible reasons. At first KNIME seems unable to support line breaks within data fields, even if they are correctly enclosed by brackets.
If you have a dataset without line breaks your CSV file formatting is not correct. Check if your data fields are enclosed by quotation marks and if quotation marks are correctly masked within each data field. Another possible source of error is if you did not mask your field separator (e.g. comma) within data fields.
Unortunately it is hard to debug these problems. I started by copying my CSV file in thousand line blocks over to a new file and reading that file until the error occurs. Then you remove the last 500 lines from the new file and so on until you find the incorrect line. I guess you got it.
Another common source of this problem is if your data legitimately contains one of the default quote characters (' or " in the file readernode, " in the CSV reader node) in a cell, in which case you need to change the settings in the CSV or the file reader advanced settings not to recognise this as a quotation character.
Thank you all. I am going to try each one of your suggestions today. BTW I could not get Excel Reader. Can you send me the link where I can download this from?
Nothing works like brute force trial and error. There were some newline characters in my CSV file. I used Excel CLEAN function to remove all these. After this the CSV READER worked good. Thanks for all your advice.