Hi Ganesh,
Yes, MDM 5.5 SP4 is compatible with SQL Server 2005.
You can check below link for more details on this or can check Product Availability Matrix on service market place(requires login):
http://searchsap.techtarget.com/tutorial/Part-4-The-OS-DB-Product-Availability-Matrix-for-MDM-55-SP4
Please let me know if you need any other information.
Thanks and Regards,
Ankush