Can somebody tell regarding J1 visa application - what documents are needed from India and from where to obtain them.

See these links:

http://www.indianembassy.org/embassy/noc.html

http://www.jipmer.org/jipmernet/usmedicine/noc.html

Hope these help. Call the number with the address in New Delhi listed in the first link, someone there might guide you about what to do.
 

Navneet Majhail