My first thought is if VLAN1 is allowed between your nutanix hosts.
Have you tried with both VMs on the same host just to eliminate the fact that might be a vlan issue at the switch level?
That network  is not really an “internal network” like you have on vSphere, it will use your SW VLAN1 for communication.

HI ​@NBorba 

I created both the VMs in the same host. 

I have only 1 Nutanix Machine and I am planning to communicate between 2 VMs within the same host. 

So you created 1 virtual machine. Gave it a nic in to network “internal_subnet_10.x” booted it up. Add an IP addres and tried to ping itself? And that didnt work. I'm not a Linux expert, but is that command sufficient? Why not add a pool of ipadresses to the (already created) ipam network? So you have a DHCP server in that specific subnet. 

HI ​@JeroenTielen ,

I did not create a virtual switch, I used the existing vs0 that is already in use for Mgmt network. After assigning static IP to linux machine, added the same to linux using commands. Regarding linux, those commands are sufficient to configure the IP address.

Prior, I used crashcart to add eth0 to vs0 and created the cluster. Just want to confirm whether this procedure is correct way to create and assign a private subnet & interface to an instance in Nutanix. 

I can use the same subnet also with already available subnet IPs, but I would like to have separate subnet for Mgmt traffic and Data plane traffic.

(This test is to have Load Balancer as a VM and Web application server in another VM and access the Web app using Data plane interface.)

But you gave you linux machine a static ip and tried to ping itself and that didnt work. So first you have to look into the linux machine why he cant ping itself. (Firewall??)

HI ​@JeroenTielen ,

Issue is fixed after rebooting the Linux machine. There is an issue with Linux instance. Now, devices could able to establish connectivity. Thanks.