Welcome to the JavaRanch, Shishir!
Web application user authentication is generally totally unrelated to LAN user authentication. Were it not so, Amazon.com would have had to set up LAN accounts for every customer they'd ever had.

And just because you're authenticated on YOUR LAN doesn't mean that that should automatically give you rights on MY LAN!
Of course, for webapps that are partially or wholly internal use, having a separate login and user identity for the LAN and the webapps can be a real pain.
Fortunately, there are ways of dealing with that. For webapps that don't get clever and try and invent their own security systems - meaning apps that use the standard
J2EE security functions, security is a plug-in feature that wraps around the webapp. That, is, it's
container-managed security. Because different shops/apps have different security needs, the actually authentication and authorization functions are handled by what's known as a
Realm.. Most webapp servers - Tomcat for example - come with a number of standard Realm modules and often support third-party Realms as well.
LAN authentication is a variant of Single-Signon authentication. Straight SSO only requires the user to login ones to authenticate to all apps in its Realm. LAN authentication takes that one step further, but using the user's LAN login as the basis. Because this form of authentication needs to know information about the LAN client that web browsers aren't normally expected to know, you have to be using a browser that is capable of providing that information. I don't know if it's still true or not, but at one time, IE users also had to have their browser security settings changed, as well - a rare case (at the time) where Microsoft ran secure by default.
A variation of this security architecture is sometimes used. Some shops find it convenient for both internal and external users to be supported, where the internal users use their LAN security rights, but external users have to login using credentials from a non-LAN source such as an LDAP server or database. That is actually only slightly more complicated.
The main things that are required are to install and configure a suitable Ream module and to ensure that any appropriate client settings are in the right configuration. After that it's all automatic.