I know to produce a template sites that essentially shows another templates in web site. When user choose particular template, The website must have transformed to that particular theme selected by user at run time. Can there be any wordpress plugin to alter the theme dynamically in wordpress. Otherwise kindly help exactly how should we implement this ?

This wordpress plugin known as theme preview essentially does what you would like. Rather than really switching the theme, it'll preview it for that user, so just the actual user is affected from the theme change and never the entire atmosphere!