Yea, I think I figured out the problem after some research. In case anyone is interested to know...
CA introduced a bunch of new ports in CA PM 3.5 release for communication between DC and DA which were not available in 3.2 . As one of our DC is in a secure site, the new set of ports were not enabled by default for communication . These need to be specifically opened on the Firewall to allow the communication (I am still trying to get this done).
I feel my issue should be resolved after I get these new ports open.
CA should do a better job of informing customers when they introduce something new which impacts the application like the ports. The DC service was not even getting started after the upgrade to 3.5 and our DC was down for days before we figured out the issue is because of the ports which were newly added .