We are having a REST WCF service. we want the save operation on this REST service to be in transaction. Is there a way to pass Transaction object over the wire to REST WCF s
Transaction support in WCF is handled by means of one of the many WS-* standards, and those only apply to SOAP - I highly doubt the webHttpBinding will be supporting transactions per se.
You might want to check into the ADO.NET Dataservices, though, which are a layer on top of WCF REST.
See a blog post by the ADO.NET DataServices team about this.
Marc