Dear Devulapally Srikrishna!

Perhaps the conditions chosen, tough enough for this type of condensation (Knevenagel type), and in this case there is a mechanism that resembles the retro Claisen reaction. Try to use a milder catalyst, for example piperidine to effect the desired condensation (see the attached file to the analogous process published in the journal ‘Molecules’, 2011, p. 6129).

Sincerely yours,

Dr. Dmitrii G. Mazhukin

Dear SriKrishna,

                             The hydroxyl-ion seems to be poor base and good nucleophile in your case. You can try stronger bases with poor nucleophillic character such as sodium hydride. 

The formation of product shows,  nucleophillic addition of hydroxyl ion on the activated emine-center followed by substitution reaction.

Both Dmitrii Mazhukin and Sushil Kumar are right. Try to use sec. amine (morpholine, ...) in aprotic solvent (DMF, acetonitrile).

Sushil kumar is right to give probable meachanism but also Mazhukin sir opinion is correct. There are two cases in the given reaction that 1) strong basic conditions led to ketones (proposed mechanism- first breaking of side chain then rearrangement occur)and 2) milder conditions led to chlacones (follow mechanism of Claisen Schmidt Reaction

While it is necessary that the chalcones formation is dependent on removal of water because of labile hydrogen (nucleophilic influence) (Claisen Schmidt Reaction)

It is a simple mechanism, addition-elimination, followed by tautomerization of the proton.  You might try a sterically hindered amine base with a trace of acid (use sulfuric, cause Cl is also a good nucleophile and sulfate gegenion is not). Failing that use modern "directed aldol" reaction means with very strong base (organometalic) in the cold to make the conjugate base quantitatively, then add the aldehyde.

The desired transformation may be difficult to accomplish. I would recommend a different approach based on the coupling of a vinyl bromide with a sulfur nucleophile, shown, with references, in the attachment.