My aim is to employ PGPool II for postgresql connection pooling.
Honestly, pgPool-II is a great tool for some tasks (like load-balancing), but it is not very good at connection pooling.
For this specific task I strongly recommend you using pgbouncer [1] instead. It is faster and more flexible than pgPool-II.
I was able to install PGPool II v3.3.3 in Linux RHEL 5.5 platform.But my doubt is how to configure data source.In the jboss standalone-full.xml, should i provide IP and port of PostgreSQL or PGPool II
The pgPool-II IP/port should be configured in your application (for pgbouncer the same applies).
and with Postgresql my application works without any issue but with PG POOL it is not connecting.
We need more information, what error did your application throw? Also, messages on pgPool's log would be nice.