Upgrading Mojave to Catalina failed
Finally solved, just posting as it might help others:

The problem: my home directory was in root folder.
So it was to be moved to /Users folder or some other drive.

I moved mine to /Users folder: Just drag and drop home folder with home icon to /Users folder. After copying is complete, log out and log in to some other administrative user (create a new user if not existing one).

Then take Users &amp; Groups, click on "Click the lock to make changes". Enter your password.

Then right click the on the user you want to change the home folder, then take Advanced options.

The click on "Choose" for the Home directory. Then select your new home folder location. 

Then save it and reboot to your user. Check everything is working fine. 
Then upgrade to catalina.

And one more thing i just want to notify is that my old home folder was automatically vanished after catalina upgrade without manual delete. So take care of your old data.