As i understand you have implemented your condition wrong
if (ProfilePictureFileUploader.HasFile == true) then pick image from uploader and set in session, otherwise pick default image from local hard drive location.
In your case you are checking as
if uploader has file
pick image from local hard drive
pick image from uploader i.e.
so in else part you will get null exception, as there is no Posted File.
ReOrder your code as
if (ProfilePictureFileUploader.HasFile == true)
System.IO.Stream fs = ProfilePictureFileUploader.PostedFile.InputStream;
System.IO.BinaryReader br = new System.IO.BinaryReader(fs);
byte profilepictureBytes = br.ReadBytes((Int32)fs.Length);
Session["ProfilePictureBytes"] = profilepictureBytes;
byte br = File.ReadAllBytes("D:/Projects/SampleProject/Images/Default Image.jpg");
Session["ProfilePictureBytes"] = br;