shut down all server processes or services.
On the database tier server node,
shut down the database listener in the old Oracle home.
On the database server node,
as the owner of the Oracle 11g file system and database instance, unzip and extract the 11.1.0.7 patch set file for your platform.
Use the runInstaller in the patchset to start the OUI.
Once the OUi starts from the LOV s in the Oracle_home list choose the appropriate one to be upgraded and the location also.
The present oracle_home and its location will appear if the environment is set correctly.
Proceed with the next steps on the OUI screen.
On next Screen it will Say Configuration Assistant has failed.Skip this Step since its not required for Oracle E-Business Suite .
MOST IMPORTANT STEP IN UPGRADE .
After Installation you need to Apply the RDBMS patches7486407 and 7684818
Copy $APPL_TOP/admin/adstats.sql from the administration server node to the database server node.
$ sqlplus / as sysdba
SQL> shutdown normal;
SQL> startup restrict;
SQL> @adstats.sql
SQL> shutdown normal;
SQL> startup;
SQL> exit;
Thank You
Osama mustafa
Technology Geek 