Suddenly unable to install application from SD card
I did an adb install -r [apk] thanks to the comment by @eldarerathis and I got an install_failed_container_error as the reason for installation failure...

Further searching got me to this link

http://eatingbits.se/articles/2010/11/16/install_failed_container_error-when-installing-an-application-on-android/

The solution being a temp file inside .android_secure folder not getting removed. So once i deleted the file app installed properly. Thanks everyone for helping out!!