I have seen this zip file error under two situations:
1) The hot deployer attempts to deploy the app before it is fully copied into the deploy directory. This can happen if you have a large app archive (WAR, EAR, etc) and you are copying over a slow connection, such as a network (hence Jaikirans questions). A typical solution to this is to copy the app archive to another location on the same paratition as the app server and then move the app arhive to the deploy directory.
2) You used some third-party utility (such as 7-zip) to build the app archive and used a conpression mechanism incompatible with Java compression. If you did this, then don't! Use standard zip compression or use the standard tools.