Havent kept my image file in cgi-bin.I put it just outside cgi-bin dir.Doesnt work still.
Also some suggestions on what parameter is required for
$cgi->img(-src=> ?
Forget CGI for the moment, access the image via a browser via http://localhost not file://. If, as others have pointed out, you still claim that your error_log isn't displaying "File does not exist: /blah/blah/image.png" style errors your apache config is wrong.