3s is not an engine built for SUV. Its a disaster in jeep. You will have to drive in lowest possible gear otherwise it will start knocking. So no option for 3s.
The 4d56 is the best possible option for your SUV. It will cost you in less then one lac with adjusting your engine.
If you go for an overhaul, it will surely cost you around 1 lac rupees even more.
I suggest you to go for a 4d56 intercooled turbo engine. It will give you a consumption of 10 plus per liter in city, on long obviously more. I am a satisfied owner of an mk2 pajero with this engine.
I use to have some hardcore offroad too, it never dies anywhere