Hi Ilja,
Eclipse has two different runners for JUnit 3 and JUnit 4 tests. Your test suite is JUnit 3 - style (see
http://radio.javaranch.com/lasse/2006/07/27/1154024535662.html for how to do it JUnit 4 - style).
I went to the above link ans was able to successfully run the TestSuite. Thanks a lot. I think this URL link is one of the very rare places where this is documented.
When you run the test from Eclipse, make sure that the launch configuration is configured for the correct version of JUnit. If you don't, you will get exactly the error message you got.
I think there is also a global setting for what Eclipse will use as default
For changing Launch Configuration, I navigated to Windows--->Preferences --->Launcing --> Launch Configurations. But did not change anything. Did not know how to do it.
Any way it seems to be picking up the JUnit version correctly from the Libraries specified in the JavaBuild Path.
Thanks Again!!