I found the solution to the issue
I was using a command
scomp -out automobile-policy.jar automobile-policy.xsd
but there was some problem with the javac location in the path variable i guess
So I gave this command
scomp -compiler "c:\Program Files\Java\jdk1.6\bin\javac.exe" -out automobile-policy.jar automobile-policy.xsd
and it gave the desired automobile-policy.jar at the location.
Please note that the location of the javac.exe might be different.