While it is always possible to have a false positive, it would be better if you took your AV's advice and got rid of the file immediately. Then update and run a complete scan of your drive(s). You can also download an AV rescue disc (preferably on another PC), burn it, boot from it and scan your system. Here are instructions for Avira, BitDefender and Kaspersky.
Ensure you have a Windows setup disc on hand, to repair the installation if required (i.e. if the system fails to boot after cleaning and restarting).
If you feel your system has been compromised and are unsure whether every trace of the infection was cleaned, the only option left is a complete nuke and reinstall of the OS.