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I own a Sony DSC-H55 point and shoot camera. It has a 14 MP CCD sensor with 10x optical zoom. I am happy with the overall image quality.
The in camera auto-white balance is producing wrong color temparature, which when corrected with GIMP is producing better result...
For eg,
Why it is happening? is there a in camera solution for it?
Edit: Other white balance presets, like cloudy etc are not suitable for most of the cases.
It would be an unusual coincidence when Auto White Balance is "correct". Auto WB has no clue what the light color is, or what color the subjects should be. Auto WB is merely lazy, an easy click, but not actually concerned about correct.
I don't think this is an example of White Balance though. There was something else "auto" included with it. This Gimp result didn't really change WB, it just made everything much brighter and vivid, which can make everything more pleasing. The greens are brighter, the blues are brighter, the pinks are brighter (closer to white), and the whites and reds are brighter. Your picture is not particularly clipped at the bright end, but the Gimp result is. And more exposure would start clipping, which is a common problem in Daylight pictures with lots of red.
There are easy WB solutions, like including a known neutral colored white balance card in a first test shot, so that software WB tools can correct it to actually be neutral again, removing whatever color tint was there before. This only corrects WB, it does not correct exposure.
White Balance Temperature (degrees K) shifts blue and yellow in opposite directions. But your change did not go in opposite directions. Incandescent WB moves blue higher and yellow lower. Daylight WB moves yellow higher and blue lower (red and green are components of yellow, which moving it higher does tend to clip them).
We can instead increase brightness with gamma (the Histogram Levels center slider), which can brighten pleasantly, but does NOT risk clipping.
You have an image here with a lot of red in it.
In principle, "auto white balance" uses the average colour of the image to decide what settings to use to make that average colour correspond to a neutral image (where neutral grays in the scene are neutral in the image). The calibration done by the camera maker uses samples of common images to calibrate this mechanism, if your image is very different from that calibration, the "auto white balance" will not give a good result.
To get better results for such images, you can use one of the other white balance settings, corresponding to the lighting you have (e.g. outdoors, you could use the 'daylight' or 'cloudy' settings, indoors is more difficult, as incandescent lamps are becoming rare, and the others have a more variable spectrum).
Most (?) cameras also have a custom setting, where you can take a picture of a neutral target to set a whitebalance corresponding to the light situation you have.
And as said in the comments, if you really want a perfect white balance (if such a thing exists), shoot raw and set the white balance in post-processing (and even then, you'll have to include a patch of neutral gray in your image).
Be aware that the best white balance in practice is not always the one you would get using one of these procedures. Typical exemple is a sunset, where the light is very warm (orange). A theoretically perfect white balance would kill all the rich colours which made you want to take the picture in the first place (it will look as if it was taken midday...)
