snehanidhi,
It looks like you need to include the library where your fifo is compiled. Or, you failed to compile the fifo.
So, if what I said above is correct, you need to use library statements and use statements to bring in the unbound object.
If the internal_memory: fifo is compiled in a library other than "work", you will need to add an entry to your .ini file as well.
If everything is compiled in "work", then anything needed should be found auto magically.
You may have to compile the coregen library as well. You should be able to find it in the Xilinx application directory. If you compile it into the work directory, it should be found.
Far as I know there are no special modelsim versions that would make your problems go away.
Hope that helps
Sckoarn