Talked with Marc on this. This is a known issue and there is a fix for this. I am pasting the solution posted on the forum by Marc B sometime back.
Final Solution
* Download C3P0 from SourceForge
* Extract c3p0-0.9.1.2.jar from the .zip file, and place it in jboss/server/default/lib
* Remove all hibernate.dbcp.* properties from your hibernate.cfg.xml - don't forget to remove the property connection.provider_class because we're replacing that line with a new connection provider
* Add the following XML fragments to your hibernate.cfg.xml file
Code:
<property name="connection.provider_class">org.hibernate.connection.C3P0ConnectionProvider</property>
<property name="hibernate.c3p0.acquire_increment">3</property>
<property name="hibernate.c3p0.idle_test_period">14400</property>
<property name="hibernate.c3p0.min_size">5</property>
<property name="hibernate.c3p0.max_size">75</property>
<property name="hibernate.c3p0.max_statements">0</property>
<property name="hibernate.c3p0.timeout">25200</property>
<property name="hibernate.c3p0.preferredTestQuery">select 1</property>
<property name="hibernate.c3p0.testConnectionOnCheckout">true</property>
OR
You can read the entire thread here for more information on the issue.
http://forums.pentaho.org/showthread.php?p=178067&highlight=C3P0