Great question, Vishal! I wouldn't use single quotation marks in that instance. One option is to avoid the issue as in:

The boss said, “You are looking at the most handsome person in the world.”

Bill smirked, wondering when his boss looked in the mirror last.

Another option:

The boss said, “You are looking at the most handsome person in the world.”

Oh yeah? Bill thought. Ever taken a look in the mirror lately?

Or:

Oh yeah? Bill thought. Ever taken a look in the mirror lately?

I'd use whichever option works for your story. An editor will change such usage for the style of their publication. Hope that helps! K.