adding favicon in Master page and viewing in IE 7

[Quest]

I am trying to add Icon but itz not working. I did upload 16 x 16 image and added
<link REL="SHORTCUT ICON" HREF="favicon.ico">
in head tags.
I see Icon in mozilla but not in IE 7.
Also when I type www.mywebsite.com/favicon.ico it gives an X mark image. When I right click and say show picture then it shows our Icon
Any help is appreciated
Thanx

[Quest]

and I did delete history, added my site in favorites, opened new IE