Question: Does static methods and class are good for scalability ? I think so static class/method improves scalability of application and instance methods doesn't scales much. So is it good programming practice to write static method where ever it is possible ?

Answer: 
It depends on *WHY* the method is static. If it's static because it truly does not need context, then it will probably scale very well compared to something of similar complexity that is not static because it requires context.

However, if it is static merely because you cannot retain the needed context and must still pass it in, or because of some artificial goal of having more static methods, then I would suspect that it will actually scale LESS than the comparable method as non-static.

In fact I think that ASP Classic proved this point.
I think you're barking up the wrong tree:

In the real world, scalability (or the lack thereof) typically springs from appropriateness of one's algorithms and the efficiency of the operations made against data stores (think: good SQL queries).

Things like whether a method is static or not (or the % of methods which are static) generally have nothing to do with the scalability of a system. You can certainly have a super scalable system which uses no static methods, or super scalable system which uses them exclusively.