If you are using a reference selector, the system will show all selectable objects. What you could do is to limit the amount of selectable objects in the properties of the selector. You can do this by xpath or microflow.
But you may loose control over the object the user picks.
Maybe City needs to be a seperate Object that is unique and maybe you can let your location point to a city. Doing it like this keeps the city unique and you can stil have multiple locations in the same city.
You have master pages to add city. Please check how many times you have Mumbai there. If there is duplicate, validate in save microflow of city master page. Hope this helps.
Avoiding duplicates can be arranged by setting a validation rule in the entity with the cities. Delete individual duplicates before setting the unique constraint.