PHP was configured with the following :

./configure 
--with-mysql=/usr/local/mysql \
--with-xml \
--with-openssl=../openssl-0.9.6a \
--with-gettext \
--with-apache=../apache_1.3.20 \
--enable-track-vars \
--enable-force-cgi-redirect \
--with-imap=../imap-2001.BETA.SNAP-0105251616 \
--with-imap-ssl 

This is the simple mail script I used to test the mail() function :

<?php

$mail_to = "alragom@yahoo.com";
$mail_subject = "PHP test mail() ";
$mail_body = " i hope that this mail() function works ! \n";
$mail_body .= " this is supposed to come on the second line \n";
$mail_body .= " and this on the third line \n";

if (mail($mail_to, $mail_subject, $mail_body))
	echo "Successfully sent the email \"$mail_subject\" to $mail_to .";
else echo "Failed to send the e-mail \"$mail_subject\"." ;

?>

I using qmail 1.03 so I used the sendmail wrapper, the only change made to the default php.ini file was this :

sendmail_path   =       /usr/sbin/sendmail -t 

Upon running the above mentioned script, I get the error 

mail() is not supported in this PHP build on line 9
Failed to send the e-mail "PHP test mail() ".

Therefore I tried recompiling php-4.0.4pl1 and installing it, and was able to run the same script with no errors !

I hope that this problem is resolved. 

Thanks a lot !
Firas