That's not a core feature - likely some incompatibility with your css and a plugin that affects the registration page (profile manager?).

Yes it can be fixed, but there's no good way to tell you how as it depends on too many factors.  You'll need to inspect your css.

Yes I have profile manager plugin.......and I kind of got that it is because of that....but I looked over the css in profile manager and everything looks OK..

Use your browsers inspect tools to see what is happening, looking over the css in the plugin probably won't give you an idea of what's actually happening on the page.  Especially if you have other plugins affecting the css or markup.

I saw your website. You are using your own custom design for elgg. This is not an elgg issue but your design issue. I can give you a dirty fix but I would suggest you to find the actual error and fix it. Temporarily what you can do is edit your css file and add margin-top: -70px; to your .elgg-icon.profile_manager_validate_icon_invalid and .elgg-icon.profile_manager_validate_icon_valid class. So the class would look like

.elgg-icon.profile_manager_validate_icon_invalid {
    background-position: 0 -252px;
    margin-top: -70px;​
    display: inline-block;
}

elgg-icon.profile_manager_validate_icon_valid {
    background-position: 0 -252px;
    margin-top: -70px;​
    display: inline-block;
}

Note: This trick might hamper your other css view where the class is called.