@Elias Sh.
I have solved this.
Try this
@Override
public void onDraw(Canvas canvas) {
super.onDraw(canvas);
// draw background
canvas.drawBitmap(bgr, 0, 0, null);
// copy the default overlay into temporary overlay and punch a hole
// in it
c2.drawBitmap(overlayDefault, 0, 0, null);
c2.drawCircle(X, Y, 80, pTouch);
// draw the overlay over the background
// code for png's with transparency
/* canvas.drawBitmap(overlay, 0, 0, null); */
// below code to be used only if images are NOT png's with transparency
Paint ptouch2 = new Paint(Paint.ANTI_ALIAS_FLAG);
ptouch2.setXfermode(new PorterDuffXfermode(Mode.SRC_ATOP));
canvas.drawBitmap(overlay, 0, 0, ptouch2);
}