Is it possible to download and extract a zip file from a url to my server using php script..
the download to the folder where the php file is placed..
Yes, but it's not very easy. Or rather it's easier doing it someplace else. Like a bash command: pipe wget or curl into unzip.
If you're on *nix system then it's probably even easier.
File_get_contents will get the contents of a file, which you can save to another file if you wish with file_put_contents
Php then has various zip functions - look in the manual
If on the command line, you can do
unzip file.zip -d extract/location
Then you can use exec to run these commands from php