Python/Curses 200 194 182 121

Assumes file is in working directory and file name is stored in variable f

from curses import*;import time;s=initscr();F=file.read(file(f)).split('\n');y=0
while 1:
 for i in F:
  s.addstr(y,0,i);s.refresh();y+=1
  if i=='':y=0;s.clear();time.sleep(1)

Or, down to 121 when not using curses

import time,os;F=file.read(file(f)).split('\n')
while 1:
 for i in F:
  print i
  if i=='':time.sleep(1);os.system('cls')

Note: replace 'cls' with 'clear' if no a unix based system, adding 2 chrs.

ctl+C to quit

Edit: Changed the filename method, now uses a variable (-6chrs)
Edit: Changed the for to iterate through the list F - Thanks ace (-12chrs)