I have Windows 2003 server which act as domain server and there are client PC / users who are connected to the domain server. I want to implement a system such that a certain group of users should not be allowed to execute ftp command from command line or from the browser. I prefer a simple solution which does require an additional software.

You can block FTP on the users local firewall with a group policy http://technet.microsoft.com/en-us/library/bb490626.aspx