I am using putty to connect to my linux server and if I open any files with vim or vi editor the editor margins are getting limited, whereas the same full screen is coming if I open in XTERM. My desktop screen is having 1280 X 1024.
You probably have
:set lines=N columns=M commands that do the resizing. Unfortunately, not all terminals support the dynamic resizing. Apparently, PuTTY doesn't. I also tried
$ stty columns 120
directly in the terminal, also with no effect.
With PuTTY, you can work around this by manually putting its window to fullscreen (e.g. by double-clicking on the titlebar).