I am raising Value Error in my API because the input parameter of a particular function is not valid like below

Password doesn't match
User doesn't exist in db or the value is negative 

Client provided valid argument as per the API norms so I think Client side error is not the case(400 series code).
So whether I have to return status code as 200 because that request is totally processed or there should be a http status code for this.
You should send another status code.
A good example of a processed request which gives another status than 200 is the redirection 3xx. After submitting a form through a POST request, it is recommended that the server gives a 307 Temporary Redirect. However, the request was totally processed, and even succeeded.
In your case, something happened (an exception has been raised). Let the client know it by sending a adequate status. I would recommend 403 Forbidden or 401 Unauthorized.
What is the http status code when Api raises ValueError?