@animeshjain I think the error is coming from the local Python bundle parser, not from the schema itself, your CLI is showing a schema where lifecycle is valid for volume, but may be the installed databricks.bundles.volumes runtime that actually parses the YAML is older and still rejects that field.
You can try checking if multiple Databricks CLI installs are present by running below
which databricks
databricks --version
python -c "import databricks.bundles.volumes as v; print(v.__file__)"
and if that points to an old virtualenv/site-packages path, do a clean reinstall of the Databricks CLI and upgrade to the latest available version rather than staying on 1.6.0. Removing .databricks alone might not fix this because the failure is in the installed parser code, not bundle state.