How can air resistance do work on a freely falling body on earth. then it's displacement is only due to gravity. I think Air resistance doesn't displace the body falling. So what is the meaning of work done by air resistance.
The forces of air resistance are directed against the direction of the falling body, so air resistance performs a negative work, which is typically the case with friction forces.
We can also say that the falling body, powered by the gravity, performs a positive work on the air it displaces or, alternatively, the force of gravity performs a positive work on the air by pulling the body to the ground.
In general, due to the Newton's third law, any time A performs some positive work on B, B performs negative work of the same magnitude on A.
It is displacing the object in the sense that without the resistance, your object would be moving faster and thus be at a different spot.
In the rest frame of a freely falling object (no air resistance) your object appears to be accelerated backwards. So the friction has effectively displaced the object.