Umer, I'd agree with most of Nadia's advice. I would however, stick to your pen tool - making sure you're zoomed in to at least 300% - as it does a much better job of rounded areas than the brushes. And get to love layer masks - they are truly invaluable. My advice is as follows:
1. Duplicate the background layer. Turn off the background layer - click on the eye to hide it.
2. Use pen tool (at least 300%) to select your object. I like to follow the edges whenever possible (you don't have to work inside the edges.....) Take your time - the better job you do with your pen, the better the result. Convert the path to a selection.
3. Create a layer mask from your selection (click on the layer mask button at the bottom of the layers palette) Doing this isolates your image in a non-destructive manner - that is, you're not losing any pixels but simply hiding or showing them. If you delete you are losing those pixels, or information, forever - not recommended.
4. Use your brush to touch-up any areas by painting on the layer mask. (black brush = hide pixels, white brush = show/reveal pixels)
Layer masks are fantastic as you are always able to go back and do any changes as you see necessary. If you are adding a background to it, try using your blur tool on the layer mask to help the image blend into the background more effectively. Again, if you make a mistake, use your brushes to hide/reveal or fill the entire mask with white and start over.
Try the following site for a very simple example. Scroll down to PEN TOOL technique.
http://www.sitepoint.com/print/masking-techniques-photoshop Hope this helps. Good luck!
