Here is the good news! After being tracking each and every data ECM produces while driving and knocking, it was realized that there is nothing to do with any sensors or anything related to false data. Purely it was a dead end by the way.
so it was convinced that this is something related to combustion chamber or exhaust back pressure. Since pulling the exhaust header out is the easier way, I decided to go ahead with it.
After removing the header, I realized that one catalytic converter honeycomb was entirely missing and other one is still in tact. I believe there should be two cat converters by the way! In this model, there are two exhaust header chambers (bank 1 and bank 2) with two separate o2 sensors in place and no o2 sensors in place after the cat converters. Each chamber/bank has each cat converter in place.
My expectation was a clogged cat but one is already missing and other one was not so clogged, it was a dead end again to me. But when I was trying to clean the cat with soapy water, I realized it took so long to travel water to the other side. I submerged it for few hours and cleaned thouraly and dried it under hot sun.
while the cat dries, I inspected the exhaust ports and found out leaking oil from top of the valve may be due to leaky valve seals (hoping). This could be same in intake side I assume. Since this requires tons of work and head needs to come out, I kept it for future repair.
after drying out I fixed the header and also cleaned both o2 sensors just in case if there are any clogged passages that may not visible to bare eye.
today I drove the car as usual to office and had few mid day trips around Colombo and did all the possible steps to create the knock but it was hardly there!
So I assume that there was an exhaust back pressure that was causing the engine to knock. Or may be cleaned o2 sensors did the trick? I don’t think so as I get the same reading from sensors like before.
opened for discussion.