Till yet there is no much easy method for rooting the Moto E, but the following method is working. In this method you will have to follow each and every steps carefully.

1. Download mfastboot-v2 extract its content and use that for unlocking Bootloader
2. Unlock your bootloader From Here
TIPs:
  • Unlocking bootloader will wipe your device, Backup your photos, music, contacts using applications in play store or whichvere method you prefer
  • The motorola site tells us to download the android SDK, You can skip that big download and use the fastboot in step 1
  • Follow the further steps given on motorola's site, After clicking on Request an Unlock Key, You will get an email which will consist guideline to proceed further!
  • Clicking on Request an Unlock Key is the point where you lose your warranty
3. Download The TWRP recovery from here or here(Goo.im) rename it recovery-twrp.img and move it in the same folder as of step 1
4. Download The SuperSU from here(thread) or here(chainfire.eu)() and copy it into the root of your internal memory!
5. Connect your phone to PC and Reboot to bootloader by pressing VolumeDown+Power button for about 6-7 seconds.
6. Go to the directory in step 1, Do Shift+RightClick in empty space in the folder without selecting anything, Select Open a command window here.
7. Run following command
Code: fastboot boot recovery-twrp.img

If facing errors refer to TIP No. 2 and 3

8. Now touch doesn't work in recovery straight away, so wait 60 seconds without touching the phone, The phone screen will go blank.
9. Press power button and do swipe to unlock to get your touch working again!
As Motorola released source code for the kernel, developer has fixed the touch issue, you can skip to step 10 directly!
10 .Select Install, scroll down and find the SuperSU Zip downloaded in step 4.
11. Swipe to confirm, wait untill the flash is complete and then select reboot, to boot into your phone which is rooted now
12. Check your app drawer, There should be SuperSU installed. Congratulations you are rooted!