I have a custom view in which i am drawing one big circle and a small circle on the edge of this big circle.
I would like to move the small circle and so would like
You can get the rectangle of your touch point and the rectangle(position) of your inner circle and check if they cross over with the Intersects method.
http://docs.oracle.com/javase/7/docs/api/java/awt/Rectangle.html#intersects(java.awt.Rectangle)
Your canvas onTouchListener can do whatever it needs to do if the touchpoint intersect your circle.
e.g:
// Create a rectangle from the point of touch
Rect touchpoint = new Rect(x,y,10,10);
// Create a rectangle from the postion of the circle.
Rect myCircle=new Rect(10,10,20,20);
if (Rect.intersects(myCircle,touchpoint)){
Log.d("The circle was touched");
}