We have built the Linux-2.6.25.4 version linux with tool chain scratchbox-toolchain-cs2005q3.2-glibc2.5-arm-1.0.7.2-i386,

Situation:
when we are trying to bring up on our hardware, we are observing that its crashing at the file(fs/binfmt_elf.c) at function(load_elf_binary) while calling the statement padzero(elf_bss)

Other things to know:
we are trying to bring up the file system from the SD card, formated the sd card with ext2 format and copied the file system files into the partition 1.
we also observed that the "elf_bss" should have the proper address of busybox, but its having some value (0xCA908) which is not a valid address.

How were the files on the SD card compiled? It seems like perhaps the address space of the exe wasn't set up correctly by the compiler/linker (this is just a guess though). Have you looked at the busybox executable itself (e.g. with readelf or a similar tool?). My guess is it wasn't linked correctly for your platform (ARM). You'll probably need to go back to where you got the exe from, but as someone who's only dabbled in embedded programming, that's about all the advice I can give.