What's the difference between the contact and contactless smart cards more technically and physically is there identification to distinguish them ?
EDIT: Some smart cards like debit card will have magnetic strip also if magnetic strip is there then it can be contact/contactless i.e. can be read by any reader ?
The question almost contains its own answer! OR you need to improve the question.
Contact based cards have physical contacts, as shown by Matt.
Non contact cards use some form of electronic "signal" to transfer data. Current credit cards and similar use a technology termed RFID as Matt noted - although with smart cards this is usually used in such close proximity that it is liable to be near-field communications* using magnetic coupling rather than true RF.
Other coupling options for non contact cards could be capacitive (electric field coupling) and even optical is a possibility although not used in mass market applications so far AFAIK.
To the query "is there identification to distinguish between them", the apparently obvious answer is that because they use physically different interface mechanisms they are automatically distinguished by the very act of reading them. That is, a contact based card can only be accessed by a contact technology reader and a non contact card must use the RFID or capacitive or whatever method that the card is based on - so the system is necessarily aware of what is being interfaced with.
Typical circuit
EM4095 RFID front end IC overview
EM4095 Read/Write analog front end for 125kHz RFID Basestation - Datasheet
"Contact" smart cards use physical contacts to communicate. This is like the SIM card in your phone, or the Chip & Pin on your credit card:
Contactless use a form of RFID to communicate the data.
