What is use of 301 code in SEO...?

301 redirection is permanent redirection which is used to redirect 1 page to other page or 1 domain to other domain.

301 redirects tell search engines a page name doesn't exist anymore- or that you don't want it indexed anymore as it has been replaced by something else.

If you don't want to lose PR for the page so you set up a 301 redirect. This tells Google and other search engines the page has been moved or renamed. This will also redirect any users that might have clicked a link.
 
301 redirect is the most efficient and Search Engine Friendly method for webpage redirection. It's not that hard to implement and it should preserve your search engine rankings for that particular page. If you have to change file names or move pages around, it's the safest option. The code "301" is interpreted as "moved permanently".
 
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