Hi Bharath Kumar,
There could be two reasons:
1. The zip file you have is zipped twice. In this case you need to unzip the outer zip file to get the inner zip file.
2. As Dinesh mentioned there could be folder inside folder which contains the metadata.xml file. In this case extract the folder and then zip the inner folder and import this in ThingWorx.
In short the metadata file should be available in the first folder for the Extension import to work successfully.
I hope it helps.