Hey Sreelakshmi,
If the REMOVE operator is not supported for the AdWordsUserList service, as you describe, then perhaps this documentation page should be updated accordingly. I've spent a couple of hours trying to figure out why my mutate REMOVE operation isn't working, and this page in particular I found misleading as it seems to imply that ADD, REMOVE and SET are valid operations.
I know this doesn't fix the lack of support for REMOVE and that is not likely to change, but an update to the documentation may help others avoid confusion on this point.
Regards,
Roger