I had a jar file which I wanted to included into classpath of maven compile so that it could compile the project source files. Quick google search landed me on this page - http://www.mkyong.com/maven/how-to-include-library-manully-into-maven-local-repository/, which had the exact solution to my problem.

And here is the maven document page about this feature - http://maven.apache.org/plugins/maven-install-plugin/install-file-mojo.html