Sample client and server working but not real telnet

[mdj_kerberos]

hi all,

  I have configured KDC,Client and server on a single machine
-------------------------------------------------------------
my /etc/hosts file is

192.168.1.2             localhost.localdomain localhost
127.0.0.1               localhost.localdomain localhost

------------------------------------------------------------

I am able to run the sample server and client and its output is:
connected
sendauth succeeded, reply is:
reply len 23, contents:
You are madhuri at KERB.COM
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my principal list is:
kadmin:  listprincs
K/M at KERB.COM
admin/admin at KERB.COM
host/localhost.localdomain at KERB.COM
kadmin/admin at KERB.COM
kadmin/changepw at KERB.COM
kadmin/history at KERB.COM
krbtgt/KERB.COM at KERB.COM
madhuri/admin at KERB.COM
madhuri at KERB.COM
sample/localhost.localdomain at KERB.COM
telnet/localhost.localdomain at KERB.COM
-------------------------------------------------------------

I have restarted the telnetd by making proper changes to the xinetd
file
and restarted it --> service xinetd restart

but when i give "which telnetd"
it shows /usr/sbin telnetd

whats  wrong here ???
---------------------------------------------------------------
When i give 
/usr/local/bin/telnet -a 192.168.1.2  OR  /usr/local/bin/telnet
localhost.localdomin

Trying 192.168.1.2...
Connected to localhost.localdomain (192.168.1.2).
Escape character is '^]'.
[ Kerberos V5 refuses authentication because telnetd: krb5_rd_req
failed: No such file or directory ]
[ Kerberos V5 refuses authentication because telnetd: krb5_rd_req
failed: No such file or directory ]
Login incorrect
Connection closed by foreign host.

whats wrong here?????????
---------------------------------------------------------------------
my krb5.conf file :
[logging]
 default = FILE:/var/log/kerberos/krb5lib.log
 kdc = FILE:/var/log/kerberos/krb5kdc.log
 admin_server = FILE:/var/log/kerberos/kadmind.log

[libdefaults]
 ticket_lifetime = 24000
 default_realm = KERB.COM
 default_tgs_enctypes = des3-hmac-sha1 des-cbc-crc
 default_tkt_enctypes = des3-hmac-sha1 des-cbc-crc
 permitted_enctypes = des3-hmac-sha1 des-cbc-crc
 dns_lookup_realm = false
 dns_lookup_kdc = false
 kdc_req_checksum_type = 2
 checksum_type = 2
 ccache_type = 1
 forwardable = true
 proxiable = true

[realms]
 KERB.COM = {
  kdc = localhost.localdomain:88
  admin_server = localhost.localdomain:749
  default_domain = localdomain
 }

[domain_realm]
 localdomain = KERB.COM
 .localdomain = KERB.COM
-------------------------------------------------------------------
MY kdc.conf file is:

[kdcdefaults]
        kdc_ports = 750,88

[realms]
        KERB.COM = {
                database_name = /usr/local/var/krb5kdc/principal
                admin_keytab =
FILE:/usr/local/var/krb5kdc/kadm5.keytab
                acl_file = /usr/local/var/krb5kdc/kadm5.acl
                dict_file = /usr/local/var/krb5kdc/kadm5.dict
                key_stash_file = /usr/local/var/krb5kdc/.k5.KERB.COM
                kdc_ports = 750,88
                max_life = 10h 0m 0s
                max_renewable_life = 7d 0h 0m 0s
        }
---------------------------------------------------------------------

can anybody reply?

thank you