Once I change the external interface to Public IP, Tunnel does not come up.
Do I need to have a router between with two WAN ports !!!
If you are directly connecting the two WAN interfaces together then they will need to be in the same subnet to see each other. They are connected on the same layer 2 network in this mode. To place them in different subnets in your lab you would need a layer 3 device between them to route between the two assigned subnets. You can do this with a layer 3 switch having the gateway for each the the "public" or private interfaces on the WAN ports configured as the layer 3 interface on the switch.
Also if you have time can you provide some guide on how to configure multiple subnets
( vlans) on SRX220. I need to configure VLAN2,3,50,52 on SRX220.
I'm not sure exactly which instructions your going to need here. There are lots of ways that multiple VLANs might be configured on the SRX depending on how you use them. We'll need a basic topology understanding.
The other thing we need here is the version of Junos you run, there are two different layer 2 methods now with recent Junos upgrades. Based on your hardware I would assume you are on the original layer 2 methods but would want to be sure before sending over instructions.