the solution provided by Ajay Deshwal is a very good reference point to work on .png Base64 images in iText.
all i did was to goto my HTMLWOrker and edit the method startElement(String tag, HashMap h);
at this section of the method, if (tag.equals(HtmlTags.IMAGE)), blahblah.. just add anther check
if(src.startsWith("data:image/png;base64")){
final String base64Data = src.substring(src.indexOf(",") + 1);
try {
img = Image.getInstance(Base64.decode(base64Data));
} catch (Exception e) {
throw new ExceptionConverter(e);
}
}