Updated the theme to 1.6.1. As per the notification, I saved the General, Category Color, Page Color and Custom CSS under Theme Options. Checked the site and none of the Adsense codes were working, not even the codes placed on the sidebar widget (not the theme's widget). Broken codes were displayed on their respective positions.
Deleted the codes and pasted the codes again but as soon as they are saved, they get broken, both in the front end at the place where they are inserted. Noticed that when the codes are deleted from the Advertisement Settings, the sidebar ad displays properly.