A smart antenna based scheme is proposed here for RFID assisted localisation in indoor wireless environments. Conventionally a target tag is localised with the help of multiple readers. Here, instead of localizing the tag, our aim is to localize a slowly moving reader which can identify its own location to move along a prescribed path. Instead of covering the whole area with RFID tags, we make use of minimum number of passive tags which are kept coplanar with the reader array. A uniform linear antenna array of dipoles is employed at the reader, so that the directional property of array can be exploited to estimate angles of arrival and ranges using standard Capon beamforming and MUSIC algorithms. We compare the performance of these two algorithms and discuss the minimum number of antenna elements required to localize without compromising the location accuracy.