Which of the following statements is incorrect regarding the Indian Councils Act, 1861:

● Statement 3 is incorrect: The System of Budget was introduced in 1860 during the tenure of Lord Canning and hence was not brought through the Indian Councils Act, 1861. ● Statement 1,2 and 4 are Correct: The main provisions of the Indian Councils Act, 1861 are as follows: Local representation in the Legislative Council was provided by the Indian Council Act, 1861. Lord Canning (first Viceroy of India) nominated three Indians to the Indian Legislative Council- Raja of Benaras, Sir Dinkar Rao, and Maharaja of Patiala. Provided for the establishment of legislative councils for Bengal, NWFP and Punjab. Initiated the process of decentralization by allowing Bombay and Madras presidencies to enact legislations. Gave recognition to the portfolio system introduced by Lord Canning in 1859.