No, you cannot. Once you've accepted a seat in the first round of AIQ counseling, even with the option of upgradation, you cannot simultaneously participate in the state quota counseling process.
The Medical Counselling Committee (MCC) conducts the counseling for 15% All India Quota seats. You can opt for upgradation in subsequent rounds if a better seat becomes available. Each state conducts its own counseling process for the remaining 85% of seats.

I hope this information helps.