\documentclass[12pt]{report}

%\usepackage[all, knot]{xy}
%\xyoption{arc} 

\usepackage{graphicx}% Include figure files

\begin{document}

\thispagestyle{empty}

\begin{center}
\begin{picture}(250,150)
  \includegraphics[scale=.5]{J.eps}
  \put(-235,40){$\Sigma_1$}
  \put(-100,20){$\Sigma_2$}
  \put(-173,78){$\gamma$}
  \end{picture}
\end{center}




\end{document}
