Hi Shaunak,
The Sigmoid Cross Entropy loss layer calculates the Cross-Entropy between the output pixel values and the groundtruth pixel values.
Check this.
Note that natural log of values greater than 1 is positive and values less than 1 is negative.
The net output layer most likely produces a value greater than 1. Putting this value in the Cross-Entropy formula yields a negative error.
Hence using Cross Entropy loss layer with softmax will work well as it produces probabilities as the output (less than 1, hence positive error)
I believe this is the reason but feel free to correct me if I am wrong.
Clint