Are you planning to buy in India or mail-order from the US ? Not knowing your pricing there, I'm at a disadvantage.
I certainly would expect to do better by choosing pieces rather than a home theatre in a box. The main systems sold in that price range are Bose, and you don;t want to do that.
If you were on or near the states, I'd recommend the axiomaudio.com speakers. I don;t know if they ship out..
I'm not real familiar with exports, etc, but these guys (BH Photo) have decent prices and moderately good equipment and they will ship to the mon if you;re willing to pay the freight.. It would fall well within your budget. I've only had to ship something back once, and there was absolutely no problem.
http://www.bhphotovideo.com/bnh/controller/home?O=productlist&A=details&Q=&sku=321695&is=REG
The whole speaker set is about $ 700 less than would be sold at Best Buy.
http://www.bhphotovideo.com/bnh/controller/home?O=productlist&A=details&Q=&sku=316906&is=REG
at $ 349.95, it's not spectacular, but does give you 7.1 capability, on-screen programming, and (heresy here) video upconvert... the remote's not the easiest to work with, but you'll get very good sound.
http://www.bhphotovideo.com/bnh/controller/home?O=productlist&A=details&Q=&sku=316943&is=REG
at $ 119.95, this DVD player gives you all the basic formats except DVD-A and SACD. You might go look at one of the Pioneer models if you would like that capability.