Dear Shivani,
see the startup.a51 file from keil software. (www.keil.com)

Here IDATALEN is internal data memory length and is 0X80 defined in the same file by EQU directive. So IDATALEN - 1 = 0X7Fh
and becomes
MOV R0, #0X7Fh
everything here is same as what you have wrote.
But few comments from my side.

1. It is a good programming practice to clear the internal and external RAMs in the begining of code.

2. It is not necessary to write 0XFFh on ports after reset as they are already 0XFFh!

3. Not in this code, but it is general practice to put some delay while polling any external port pin. This is called as software key debounce and nicely explained in any 8051 microcontroller book.
eg.

or you can add one more instruction as
jnb port3.2, $ ; self loop
delay... ; delay routine as wrote above.

Or some timer delay for precision.

4. And last but not the least DO write comments.

Now as the code is OK, there may be problem somewhere else. So please check it thoroughly. I mean check the hex file and the way you are burning the file in flash of uC.
Can you not post the hex file here?

Dera Jan, Shivani is "she". Normally the first names of Indians ending with alphabet a and i are female names (ofcourse with some exceptions which are always there) But as already said by Erik, it is very difficult to know the location of forumites.

Regards
Sarang