Hi,
AFAIK, the mender client will be looking for /data partition for the update.
I would like to know what will happen if the mender folder or u-boot folder somehow got corrupted!
How the device with mender can recover from this corruption (assuming the device is in remote location)? Is there any fallback/backup options are present to get the mender to update the client in this case? 
The u-boot folder (boot partition, actually) is not used by many boards. Mender would probably survive corruption here in many cases.
I’m not sure which mender folder you are referring to, there are several. Corrupting the /data/mender folder would most likely mean that Mender resets itself to a fresh device, assuming the folder is writable at all. If it’s truly corrupted, and not writable, then Mender would not recover I think.
Thank you…I’m referring to the /data/mender folder itself.
Corrupting the
/data/menderfolder would most likely mean that Mender resets itself to a fresh device, assuming the folder is writable at all
Whether this means that, all the files including the device type will recover from the corruption? Is there any backup available for the /data/mender and /data/u-boot folders?
You’re right, it will not recover from missing device_type. Same goes for /data/mender/mender.conf, used by more recent Yocto branches. But these files are never written to, so they have a pretty low chance of being corrupted, compared to the database, which is in the same directory.
No.