Thank you very much Kiani sahab for your valuable and to the point input.
You really narrowed it down regarding engine.(1HZ it is)
The larger tyre size is only for getting more road clearance and it is going to be an all terrain vehicle going on road to sand,mud,snow,small streams,gravel and rocky terrains.It will certainly NOT be a show or cosmetic vehicle.
However as you know the centre of gravity getting higher many issues start to occur and to tackle that I was considering 80's axles and suspension setup besides it will cover the spacer issue (the spacers made here in old lathe machines are not uniformed) and I'm opting for rims with 5 inch backspacing (I think it's going to be in minus offset).So up to my understanding with wider tubes and the 5" BS rims and some body trimming I might be able to get away by having a wider vehicle regarding height.
On the other hand if I stick to 40's axles and 33s,the adaptor/spacer combo with the adaptor sitting on top of hub and spacer bolted to adapter and rim (will need longer studs) will be a durable and cheaper option but won't be getting more clearance.
So, engine is sorted.
Now I need road clearance in best possible and trouble free way.
Everything is on hold as I can't figure out the best way to setup my suspension/tyre combination first.
BTW I am considering vent.disc brakes in front and flat disc at rear.
This year's budget is 10 Lac excluding engine/tranny if I go for 38s,though it can be stretched a bit more.
I'll be highly obliged by your experienced and valuable input on this matter.