I followed linuxbabe  link to set my tile server so I will not go into much detail regarding the setup instructions, For that you can follow that link.

IMPORTANT THINGS:

• You don't need big files. I used my cities area. You can download the area you want to show from this link and insert your downloaded file in step step 4 of linuxbabe 
• Make sure you are using latest version's of mapnik(v3), postgresql(9.6), openstreetmap-carto(v4.0.0)
• If  you use openstreemap-carto version 4.0.0. then you need to run following commands to generate stylesheet:

python get-shapefiles.py

carto project.mml > style.xml

Errors :

• If you get error while installing mod_tile, make sure libtool is installed if not then install it.
• If you get error Socket bind failed for: /var/run/renderd/renderd.sock Then run this command:

  sudo chown osm:osm /var/lib/mod_tile

  This command will give permissions to the user you created, in my case it was osm.
• If you get error in make while compiling mod_tile follow:  https://help.openstreetmap.org/questions/13689/problem-with-mod_tile-make
• If you are facing any issue related to rendering of file then you can use this command:

renderd -f -c /usr/local/etc/renderd.conf

• If you want to pre-render the tiles so that your processor doesn’t do processing everytime you zoom-in then you can do it via:

render_list -m default -a -z 0 -Z 10