I'm not able to make something without ref
Work on that then.
There is no point in receiving critique for the errors of someones interpretation you are copying, even if it is flipped horizontally as it doesn't fully reflect your current level.
To expand on the above; everyone starts via imitation (actually many people pass off similar reproductions as 'inspiration' 
) but why not reference selectively from multiple (primary) sources to create something of your own?
Use references, just don't use only one and copy everything.
I hate to be the one to point this out, but the advice here seems to be very confusing.
Point 1: At one point the artists is told to try working on not using references for his/her work. That their work should consist of originality, and that critiques are useless for artists who just copy.
Point 2: The next one makes a more interesting stance to point out that when one begins to focus on creating art, they start through a process of imitation, using other people's works as a base to make their own desired work through heavy modifications or 'inspiration' as it's called. It's further pressed that using a combination of multiple sources as inspiration can help an artist grow something of his own by taking and using something from each source.
Point 3: The last advice tells the artist to simply use numerous references, but not to copy it detail for detail.
The advice graduated from refrain from using references, to using a collaboration of references to form a result from one's artistic ventures.
I agree most with the Facet's given points, but I think this blog post gives better idea of the whole argument of when it's alright to use references and when not to:
http://www.jessicahische.is/obsessedwiththeinternet/andbeingresponsivelyinspired/inspiration-vs-imitation-2TL;DR One uses imitation as a form of practice and moves onto the use of inspiration which then it graduates into the process of creating work from pure creativity.
The imitation process is used to accumulate an idea and knowledge of techniques, themes, and etc that would be both preferential and comfortable for you to use in future artwork.
In other words, the more you practice with the use of a combination of references, the more you're able to create an form that is unique to your own artistic expression.
Just make sure to remember to push yourself to be more original and restrict yourself more from the use of references in future iterations, and never make work that is
derivative (unless only for practice).
As for the newest update, I think you're taking a step in the right direction with the background. However you may want to edit some more on your devil sprite before working on backgrounds.
Once you start working on the background, it'll be harder for you to make edits to the sprite, therefore you should complete all edits to the sprite before you start on an surrounding imagery.
Some C+C on the "buildings" though is they don't look too much like buildings. Buildings have more of a square and rectangle architecture mostly, whereas these have more of a deformed texture related to canyon formations.
Personal preference though leads me to say I think a canyon theme is more fitting though.
