The qemu binary is accessible as I can create VM through command line. That is why I thought it may be a libvirt issue.

I have also contacted Red Hat support and will post my findings here if the issue is resolved.

On 23 April 2014 17:16, Eric Blake <eblake@redhat.com> wrote:

On 04/23/2014 05:44 AM, Asadullah Hussain wrote:
> Hello,
>
> I am trying run a simple VM (qemu1.4.2) on RHEL 6.5 through libvirt (0.10).
> virsh create throws the error:
>

> *error: Failed to create domain from vm1.xml*
> *error: internal error process exited while connecting to monitor:*
>
> The libvirt log for VM shows:
>
>
> *libvir: error : cannot execute binary /usr/bin/qemu-system-x86_64:
> Permission denied*
>
> I am running VM as root and all disk images/ISOs required for VM are
> read/write/executable.

The disk images may be accessible, but did you check that the actual
qemu binary was accessible? Given that you are using RHEzL, have you
considered opening a support ticket with Red Hat?

--
Eric Blake eblake redhat com +1-919-301-3266
Libvirt virtualization library http://libvirt.org

Asadullah Hussain