In this paper we address the issue of enhancement in the quality of scanned images of old manuscripts. Small portions of the text in these manuscripts have degraded with time and are not readable. We propose a segmentation based histogram matching scheme for enhancing these degraded text regions. To automatically identify the degraded text we use a matched wavelet based text extraction algorithm followed by MRF(Markov Random Field) post processing. Additionally we do background clearing to improve the quality of results. This method does not require any a priori information about the font, font size, background texture or geometric transformation. We have tested our method on a variety of manuscript images. The results show proposed method to be a robust, versatile and effective tool for enhancement of manuscript images.