How to use a variable declared using C syntax in Assembly file

void fun(void)
{
  data byte var1;

  if(var1 & 0x80)
  {
    //some code
  }
if( (var1 & 0x04)||(var1 & 0x03) )
{
   //some code
}
...
...
}

void fun(void)
{
  data byte var1;

  if(var1 & 0x80)
  {
    //some code
  }
if( (var1 & 0x04)||(var1 & 0x03) )
{
   //some code
}
...
...
}

"I want to convert second if condition into assembly"

Do you mean:

void fun(void)
{
  data byte var1;

   if(var1 & 0x80)
   {
     //some code
   }

   if( (var1 & 0x04)||(var1 & 0x03) ) // Convert this bit?
   {                                  //
      //some code                     //
   }                                  //
...
...
}

Did you really read the information in:
http://www.keil.com/support/docs/1275.htm?

" If so, the only way you can do that is by making an assembler function that you call at that point.
In that case, you will have to pass the variable as a Parameter. "

I did the same thing what u explained above.
But have not got any idea on how to pass a variable as a parameter?

I have gone through the C51's parameter passing topic but I didnt get any idea.
Since time is very less for me to complete my task ,can u please tell me the syntax for declaring that variable as extern in assembly file.

"But have not got any idea on how to pass a variable as a parameter?

I have gone through the C51's parameter passing topic but I didnt get any idea."

In that case, do as Reinhard suggested:
Create an outline in 'C', and use the SRC directive to convert this to assembler.
Then you can write your own assembler "body" to the function.
You have already been given the link (twice) to the knowledgebase article that describes this.

"can u please tell me the syntax for declaring that variable as extern in assembly file."

You could find this for yourself in a moment in the assembler Manual but, as already explained, this will not work here!