If you want to have a lot of fun offroading, it will be hard to find a substitute for a Mahindra Jeep or Maruti Gypsy. These two may be old and crude, but they still among the most capable offroaders in the world.
If size matters, the Ford Endeavour is the one for you.
But if you want a vehicle that's not too big to drive in the city, looks nice, handles well and is also a very capable offroader, the Subaru / Chevrolet Forester is unbeatable.
If you want a pure Indian SUV, the Mahindra Scorpio is a wonderful VFM package. Just drive it within its limits, because its handling and brakes aren't really great.
You've asked about the Grand Vitara and the Pajero.
The Grand Vitara has a nice and smooth engine, but it isn't too good off the road. It ain't that good looking either. As for the Pajero (I presume you are asking about the 3.2), it's got almost everything - image, looks, offroading capabilty, etc. But then, it's pretty expensive.
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