How to compile a java source file which is encoded as "UTF-8"?

Your file is being read as UTF-8, otherwise a character with value "65279" could never appear. javac expects your source code to be in the platform default encoding, according to the javac documentation:

If -encoding is not specified, the platform default converter is used.

Decimal 65279 is hex FEFF, which is the Unicode Byte Order Mark (BOM). It's unnecessary in UTF-8, because UTF-8 is always encoded as an octet stream and doesn't have endianness issues.

Notepad likes to stick in BOMs even when they're not necessary, but some programs don't like finding them. As others have pointed out, Notepad is not a very good text editor. Switching to a different text editor will almost certainly solve your problem.

Open the file in Notepad++ and select Encoding -> Convert to UTF-8 without BOM.