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Moeez, Internal linking with anchor text is fine but it should be done in a manner that assists the visitor, not in a manner that hits them over the head with spammy anchor text links all over every page.  When it's appropriate to link to another page because information on that page is helpful to the reader, it's worthwhile.  Keep in mind, anchor text can help a bit with relevance of the page being linked to but it will not be a super-strong signal, regardless of how it's implemented. Matt Cutts mentions that there isn't any penalty for having too many anchor text links from within your domain pointing to any given page.  You can also take this to mean that there's really no particular value being derived by having a bunch of anchor text links pointing to a page.  On closer inspection, you may find that there is some other reason that your competitor's page is ranking the way it is. http://www.seroundtable.com/google-internal-links-anchor-text-16864.html

Hi, Thank you for the response. Yes, 301 redirects are working fine. checked webmaster; pages are indexed. I will wait for the redirects to pass on the links then. Thank you again! Best Regards, Moeez

Ok Thank you so much for your help!

No problem! You are welcome! FYI, the page you gave me has almost no content unless a few lines and 3 pictures, plus the header with a little animation and the footer. However, it has over 10 scripts and over 5 CSS files. Heck, the first 135 lines are just the header, while the actual content of the page is from line 258 to 274 (16 lines). I would review all those wordpress files and remove as many as possible from the site while trying to merge all the others. You are making over 30 requests for a page that has only 16 lines of actual content.