@Rahul
Managed Identity is used in case where we do not want to expose the client secret to the application/code. Refer to https://docs.microsoft.com/en-us/azure/active-directory/managed-identities-azure-resources/overview for more details.
For restricting access for users to hdfs data in ADLS Please post the question at our HDInsight forum at: https://social.msdn.microsoft.com/Forums/azure/en-US/home?forum=hdinsight
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We're migrating from MSDN to Microsoft Q&A as our new forums and Azure Active Directory has already made the move! In future, you can ask and look for the discussion for Azure Active Directory related questions here: https://docs.microsoft.com/answers/topics/azure-active-directory.html.