installation of SIP trunk between CS1K of Nortel to Avaya IP Office - IP500

What are you trying to do: x-digit dialing between the sites, trunk breakout or both or maybe something else? Most issues we've encountered were because of the Byzantine licensing requirements for IP500. You need Pro, SIP trunk and/or networking licenses in any number of combinations, depending on what you needed. I'm not much of a Nortel guy so there could be any number of issues on the Nortel side as well. But for your Avaya end, check out Avaya's Tech Tips and bulletins in case there is something there that gives you a hint. There are quite a few SIP implementation guides there.