Thanks for your reply.I have added dll inside my Project folder and I am trying to refer it from there only. I also checked the application log and it gives attached error.
I also tried the solution mentioned in http://docs.telerik.com/teststudio/troubleshooting-guide/test-execution-problems-tg/network-dll-access-net4-0 but I received same error after that.
The dll I am using is updated to using .Net Framework 4.5.2 and same is installed on my machine.
Let me know if more information is required.