hi all

I want to reduce the size of pup_214.sfs. For that I mount pup_214.sfs and copy all the contents of mount directory(/mnt/test) in to a new directory(/mnt/test1) and unmount mounted directory. Then I create chroot environment and make a new pup_214.sfs file.
I used this command:
"mksquashfs archive/ etc/ mnt/ root/ usr/ bin/ grafburn-0.9.pet.specs proc/ sbin/ var/ dev/ lib/ tmp/ /pup_214.sfs"

and I also tried this command :
"mksquashfs archive/ etc/ mnt/ root/ usr/ bin/ grafburn-0.9.pet.specs proc/ sbin/ var/ dev/ lib/ tmp/ /pup_214.sfs -all-root"

But system is not booting. it shows error:
"Kernel panic - not syncing : Attempted to kill init!"
What I did wrong?
How to create new pup_214.sfs file using older one?