Try this. If you just want to see the output voltage, connect a voltmeter between Vout(2nd Pin) and the GND(3rd Pin). Then 1st pin to 5V DC. As you increase temperature from 0to150 Deg, you can see the voltage increasing from 0-1.5V on The voltmeter. To increase the temperature use the arrow signs on the LM35 in Proteus.
If you want to check for negative temp I don't think the LM35 sensor given in Proteus will be of much use.