Getting 'There are no active categories.' message even when vocabularies and the terms are present

When I go to the my subscriptions >> categories tab I get the above error even when I have 17 categories (vocabs). Is there any setting that prevents them from being active.

I traced the problem to subscriptions_taxa() function. If i comment out the foll code at the end of this function:

//if(count($subs[$account->uid]['blog'])==0){$output = NULL;}

return $output;

I get the correct list of categories on the my subscriptions 'categories' tab. Pls help.