Is it possible to highlight the group on selection of timeline item of which it is a part of?
From attached example, if I am selecting item (item 17), Group 'Alston' should somehow gets highlighted (or somehow I change its CSS, so that a person can understand which group item is selected)
This can be achieved using the select event which fires whenever an item is selected / unselected. Details on this event can be found in the vis-timeline documentation here.
When the select event fires you would need to determine the group for the selected item, or items if using the multiselect option. Then update the className for each group with a class which highlights it. You must also clear the className on any groups which shouldn't be highlighted. These updates must then be updated in the groups DataSet, once updated they'll be applied to the timeline.
An example is incorporated into this answer below and also at https://jsfiddle.net/hzevcgod/.