Company Car Or Car Allowance better ? Any Tax differences ?

The tax situation is different - and quite complicated in case of a company car (the allowance would be treated just like more salary) - ask a tax consultant about the rules and what it means in € in your case!
Maybe more important than tax: A company car is typically leased and comes with full service, whereas for a private car you must take all responsibility by yourself.

The deciding factor will likely be based on your need. With a  company car you pretty much know what you get and don't have to worry about things like repairs.

If one would take a travel allowance then I assume one can actually choose to buy or lease a car or possibly get something like a year's pass for the local transportation system, which can often be more convenient than a car if one is working and living in a large city. And one can combine this with car sharing or rentals to get a car when one would really need one.

Thanks Beppi & TominStuttgart for your information.

I saw some online Tax calculation for Car allowance, It seems quite different for choosing the company car instead of the Car allowance.

For example If :
   1. Your Monthly Gross Salary 8000 Euro (Before Tax)
   2. Company give you an option to choose to go for either Company Car (Prize
       Approx 40000Euro) / Car allowance of monthly 1000 Euro
   3. Example Tax % = 35%

Option 1 : Salary + Company Car
Monthly Tax Amount = (8000 x 35%) + (40000 x 1%)

Option 2 : Salary + Car Allowance
Monthly Tax Amount = (8000 x 35%) + (1000 x How many %)

Can anyone help me on the Option 2 How many % for the car allowance ? 

My experience of over 25 years of driving a company car was that if you're driving over 25k on business p/year then it's almost always better to take a car over the allowance, mainly because a car that's doing that sort of mileage has a very low trade-in value when it comes to change for a new car.  Low business mileage, take the allowance.

Taxes are a very complicated topic in Germany. The rates depend on too many personal circumstances to give you a definitive answer here. Ask a tax consultant (officially, only they are allowed to give such advice anyway - for a fee!) or decide based on your gut feeling. The difference is unlikely to make you much richer or poorer.
For estimating your tax bill in various (simple) cases, you can use online calculators like www.brutto-netto-rechner.info