python: can't open file '\bin\cfx': [Errno 2] Mozilla extension development

Today, I downloaded Mozilla SDK on my 64-bit Windows 7 PC and ran cfx init command to start. Then it threw this error

python: can't open file '\bin\cfx'

 When i opened cfx.bat file in the SDK\bin folder, it was looking for an environment variable called %VIRTUAL_EVN%

When I looked at my PC's environment variable list, I could not find it there. So I created it and pointed it to the SDK folder. (Not the bin folder) then error disappeared.