set the classpath enviournment variable of your system By right clicking My computer --->properties--->Advanced---> Enviournment Variables
path= <path for your java Installation>jdk1.6.0\bin\;
path= <path for your java Installation>jdk1.6.0\jre\bin\;
just set these two , and for servlets set
path=<path for the tomcat installation>Apache Software Foundation\Tomcat 5.0\common\lib\servlet-api.jar;
==========Consolidate path will be==============
you can set path at command prompt also like this
set path=<path for your java Installation>jdk1.6.0\bin\;<path for your java Installation>jdk1.6.0\jre\bin\;<path for the tomcat installation>Apache Software Foundation\Tomcat 5.0\common\lib\servlet-api.jar;
You need to remember where you installed Java; if you can't try exploring your C drive -> Program Files -> Java -> jdk1.6.0_12 -> bin.
In bin you should find about 30 programs including java.exe, javac.exe, javaw.exe, javadoc.exe, etc.
Then find this Java Tutorials page; it tells you what to do about "java is not recognised" errors, and there is a link to instructions about setting your PATH. That is, as you have been told, the usual cause of that error message. The PATH entry should start with C: and end with bin.
A Java installation with 1.4. in its number is at least 4½ years old, so you ought to have something more recent than that.