could one please give me details of smart sensor?

Answer 1

Basically its where the transducer and the necessary processing electronics are all integral to the sensor. This is often all done on the same slice of silicon.

For example a pressure transmitter uses a small change of deflection that causes a change in electrical resistance of the semiconductor that is converted to a voltage that is converted to a digital signal. All done in the same box, hence smart sensor.

Answer 2

Details depend on sensor, but I suppose generally it would measure something (pressure, temperature, etc.) apply compensation for instrument drift, etc. and encode the information for somekind of field-bus like network or even wireless Wi-Fi. Might have built-in high and low limit alarms or square-root function.