update columns values with column of another table based on condition

Something like this should do it :

UPDATE table1 
   SET table1.Price = table2.price 
   FROM table1  INNER JOIN  table2 ON table1.id = table2.id

You can also try this:

UPDATE table1 
   SET price=(SELECT price FROM table2 WHERE table1.id=table2.id);

This will surely work:

UPDATE table1
SET table1.price=(SELECT table2.price
  FROM table2
  WHERE table2.id=table1.id AND table2.item=table1.item);