I get a bubble type pop up in the bottom right hand CORNER. "Windows Security Alert - Application cannot be executed. The file wuauclt.exe is infected. Do you want to activate your antivirus software now?"

Next is a message similar to the second, but in the bottom right again. "Infiltration Alert - Your computer is being attacked by an Internet Virus. It could be a password-stealing attack, a trojan

I am not able to open the IE, ALSO not able to open any programs. To add to this problem, my USB ports are also not working, so i cannot do any data transfer from other LAPTOP in order to fix this problem. My CD/DVD drive is working properly.

Could anybody help me on how to fix this problem.
I booted the machine in "safe mode with networking" and did a System restore to last week.
I no longer face the problem. Everything seems to be working fine.

I just wanted to know, whether the virus is REMOVED or if not, what are the steps that i need to take to fully remove the virus from my laptop.

Pls help Please visit this webpage for a tutorial on downloading and running ComboFix:

http://www.bleepingcomputer.com/combofix/how-to-use-combofix

See the area: Using ComboFix, and when done, post the log back here.