Hi mohitgadhok,
You can uses AVR(8-bit ones) which can operate upto 20MHz at 20MIPS throughput. There is PIC16 which can operate upto 20MHz at 5MIPS throughput (new ones upto 32MHz at 8MIPS) or PIC18 - 40MHz at 10MIPS.
I think if price is a factor, AVR has the edge slightly. Since you already use ATMEL, it may be a wise choice to stay with ATMEL although 8051 and AVR are different.
You have to decide the number of I/O pins you require. AVR starts from 8 pins (ATtiny eg ATtiny 45) upto 100 pins (ATmega). Choose whichever one depending on number of I/O pins, program memory, RAM, EEPROM, etc
Choose your programming language and compiler. For C, there is mikroC PRO for AVR, WinAVR, CodeVision. For BASIC there is mikroBASIC and BASCOM. I suggest you use mikroC or mikroBASIC.
I've used both PIC and AVR(both with mikroBASIC and mikroC), although I like the AVR better. Choice is yours though.
Hope this helps.
Tahmid.