Psychology is an academic / applied discipline involving the scientific study of mental processes and behavior of humans and animals. Psychologists study such phenomena as perception, cognition, emotion, personality, behavior, and interpersonal relationships.
The basic premise of applied psychology is the use of psychological principles and theories to overcome practical problems in other fields, such as business management, product design, ergonomics, nutrition, law and clinical medicine. Applied psychology includes the areas of industrial/organizational psychology, human factors, forensic psychology, engineering psychology, as well as many other areas such as educational psychology, sports psychology and community psychology. In addition, a number of specialized areas in the general field of psychology have applied branches(e.g., applied social psychology, applied cognitive psychology).
So ultimately the choice between a Masters in Psychology or applied psychology would depend a lot on your interest.
If I have to choose the known universities for Psychology in India, I believe the best route is to look at the top 10 universities in India as chosen by the University Grants Commission, and then look at their psychology departments (if they have one). For instance colleges coming under the Delhi University, and Bangalore University should be among the best. The following universities should interest you :
• Jamia Millia Islamia, New Delh
• University of Delhi, New Delhi
• Bangalore University, Bangalore
• Indian Institute of Psychology and Research, Bangalore
• University of Mysore, Mysore