Never Mind Guido, thanks for your reply.
I am still not sure why blank or null value is not displayed inside that lookup which was of Customer datatype, it was showing related contact in that field, could be a mapping issue.
I tried by inserting similar kind of field and it was showing blank to begin with.
I managed to workaround with JS by pro-grammatically setting up as null.
Marking this thread as closed by verifying your answer.
Thanks
Nikhil