Somewhat surprising... the PATH mentioned in the error msg in post#1 is much shorter that the one you show in post#5. Is that for the same user? Where does sqlplus actually reside? What are the permissions on it? How do you "manually" login?
echo 'HERE'
set
echo 'THERE'
ssh venkat@$IP_ADDRESS set
Your problem is in how the environment is defined on the remote machine - assuming sqlplus works on your local machine
$ORACLE_HOME must be defined correctly to start with and whatever $ORACLE_HOME/bin is, has to be in the PATH variable as well. Note: $ORACLE_HOME/bin could end with some different subdirectory, not just simply "/bin" on machines that have both old versions and newer versions of oracle (32 bit vs 64 bit)
installed.
The reason sqlplus needs the ORACLE_HOME variable defined is to find adjunct files like .msb files. Without it defined, sqlplus will start (sort of) then you get some really odd error messages.