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I know that the liquid crystal displays contain some class of organic compound, which is somehow used to polarise light to make contrast variations(In calculator displays).

My Question is What type of Organic Compound is used in this case and How does it polarise light only when stimulated by external agents such as current in LCD's

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Liquid crystals are usually rigid rod-like molecules that tend to show some degree of intermolecular order even when notionally liquids (there is a good summary on Wikipedia). This happens because the rigid polarisable parts of the molecules can have relatively strong directional interactions even in the liquid phase.

Some of the structures they form can rotate the plane of polarised light You can get some intuition about why knowing that polarising lenses consist of highly ordered molecules whose interaction with light is highly direction dependent. In normal liquids the molecular orientations are effectively random so, even in each molecule interacts with light depending on its orientation, this effect washes out due to the randomness of the overall structure. Liquid crystals form structures where there is the possibility or large-scale order allowing macro-effects on polarisation (just like the rigid structure in a polaroid film).

The other thing that makes liquid crystals useful is that the details of the ordering in the liquid can be affected by external electric fields, especially in thin films of the compounds. In principle this is possible when any molecule is polar (that is it has a net electrical dipole). Of course, making an effective display requires a lot of fine tuning of the electrical, mechanical and chemical structure, but the basic details are simply that the molecules are affected by electrical fields and this allows some control of the macro-structure which, in turn, alters the way the liquid crystal interacts with light. the effect is not "turned on" by the field, just altered and that is enough to make a viable display technology.

Liquid crystals have a long history. The first compounds known to show liquid crystal behaviour is cholesterol benzoate, the first molecule shown below, which was dicoveredn in 1888. The other structures show some actual molecules from the early days of LCD displays to modern developments. For more examples of the history there is a great summary from Merck (one of the major manufacturers) in this slideshow.

enter image description here

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