Thanks Roland,
You are right, the Syslog folder size was 3.6 MB, as it had logged events for last 2 years. After deleing the older files i haven't seen the error.
Although the problem seems to be over, i don't understand why the system displyed error in the first place as the drive had 65% free space even before deleting the previous files in syslog folder under Labview. (We are using Labview and DSC module version 6.01). Also just as an observation, during the initial troubleshooting the number of days to keep the event files (under Tag configuration\Configure\Events) for only 1 day but still the system keeps all the files until it is deleted manually in Syslog folder.
But the system is back to normal operation.
Mehul