I want to validate radiobuttonlist based on Item.

I assumed index= 0 is approved, 1 is N/A, 2 is Rejected..

 

Try this :

 

 foreach (DataListItem item in dtLstRejection.Items)
 {
     RadioButtonList rdlReasoncodeType = ((RadioButtonList)item.FindControl("rdlReasonType"));
     System.Web.UI.WebControls.Label lbldlmsg = (Label)item.FindControl("lbldlmsg");
      if (rdlReasoncodeType.SelectedIndex == -2) // if rejected no need to validate
       {
            break;
       }
       else if (rdlReasoncodeType.SelectedIndex == -1) // if nothing is selected need to validate
       {
            lbldlmsg.Text = "*Approve fields are mandatory to check";
       }
       else
       {
           lbldlmsg.Text = string.Empty;
       }
  }