Rails 4: Error when installing tiny_tds gem?

Question

I have developed a rails web project with Ruby v2 and Rails v4. It was perfectly working in my current system and when i tried to run this project in another Linux machine (Ubuntu 12.4 ) i am getting a Tidy_tds error .

This error is showing at the time of bundle install ,

Error Details below

Gem::Ext::BuildError: ERROR: Failed to build gem native extension.                                                                                                                                

    /home/action/.rvm/rubies/ruby-2.1.1/bin/ruby extconf.rb                                                                                                                                       
checking for iconv_open() in iconv.h... yes                                                                                                                                                       
checking for sybfront.h... no                                                                                                                                                                     
-----                                                                                                                                                                                             
freetds is missing.    
Could not create Makefile due to some reason, probably lack of necessary                                                                                                                          
libraries and/or headers.  Check the mkmf.log file for more details.  You may                                                                                                                     
need configuration options.                                                                                                                                                                       

Provided configuration options:                                                                                                                                                                   
        --with-opt-dir                                                                                                                                                                            
        --without-opt-dir                                                                                                                                                                         
        --with-opt-include
--without-opt-lib=${opt-dir}/lib                                                                                                                                                          
        --with-make-prog                                                                                                                                                                          
        --without-make-prog                                                                                                                                                                       
        --srcdir=.                                                                                                                                                                                
        --curdir                                                                                                                                                                                  
        --ruby=/home/action/.rvm/rubies/ruby-2.1.1/bin/ruby                                                                                                                                       
        --enable-lookup                                                                                                                                                                           
        --disable-lookup  
--with-iconv-dir                                                                                                                                                                          
        --without-iconv-dir                                                                                                                                                                       
        --with-iconv-include                                                                                                                                                                      
        --without-iconv-include=${iconv-dir}/include                                                                                                                                              
        --with-iconv-lib       
--without-iconv-lib=${iconv-dir}/lib                                                                                                                                                      
        --with-freetds-dir                                                                                                                                                                        
        --without-freetds-dir                                                                                                                                                                     
        --with-freetds-include                                                                                                                                                                    
        --without-freetds-include=${freetds-dir}/include   
--with-freetds-lib                                                                                                                                                                        
        --without-freetds-lib=${freetds-dir}/lib                                                                                                                                                  

extconf failed, exit code 1      
Gem files will remain installed in /home/action/.rvm/gems/ruby-2.1.1/gems/tiny_tds-0.6.1 for inspection.                                                                                          
Results logged to /home/action/.rvm/gems/ruby-2.1.1/extensions/x86_64-linux/2.1.0/tiny_tds-0.6.1/gem_make.out                                                                                     
An error occurred while installing tiny_tds (0.6.1), and Bundler cannot continue.                                                                                                                 
Make sure that `gem install tiny_tds -v '0.6.1'` succeeds before bundling. 

I have also tried installing tiny_tds seperatly, but still i am getting the same issue

gem install tiny_tds -v '0.6.1'

My gem file,

source 'https://rubygems.org'

# Bundle edge Rails instead: gem 'rails', github: 'rails/rails'
gem 'rails', '4.0.2'

# Use SCSS for stylesheets
gem 'sass-rails', '~> 4.0.0'
gem 'tiny_tds' 
# Use Uglifier as compressor for JavaScript assets
gem 'uglifier', '>= 1.3.0'

# Use CoffeeScript for .js.coffee assets and views
gem 'coffee-rails', '~> 4.0.0'

# See https://github.com/sstephenson/execjs#readme for more supported runtimes
# gem 'therubyracer', platforms: :ruby

# Use jquery as the JavaScript library
gem 'jquery-rails'

# Turbolinks makes following links in your web application faster. Read more: https://github.com/rails/turbolinks
gem 'turbolinks'

gem 'jquery-ui-rails' # jquery ui

# Build JSON APIs with ease. Read more: https://github.com/rails/jbuilder
gem 'jbuilder', '~> 1.2'

group :doc do
  # bundle exec rake doc:rails generates the API under doc/api.
  gem 'sdoc', require: false
end

# Use sqlserver as the database for Active Record
gem 'activerecord-sqlserver-adapter', :git => 'https://github.com/nextgearcapital/activerecord-sqlserver-adapter.git'
gem "therubyracer"
gem "less-rails" 
gem "twitter-bootstrap-rails"
gem 'bootstrap-datepicker-rails'
gem 'will_paginate'
gem 'sqlite3'
gem 'formtastic'

Why is this error appearing and how to solve this issue.

Any help is appreciated