Introduction:
The budget is an important economic tool used by governments to allocate resources and manage finances. In India, the system of budgeting was introduced during the British colonial era.

Answer:
The correct option is 'D', i.e. 1860.

Explanation:
The system of budgeting was introduced in British India in 1860 by James Wilson, who was then the Finance Member of the Council of India. The first budget of India was presented on April 7, 1860, and it covered the period from November 1, 1859, to April 30, 1860.

Importance of the introduction of budgeting system:
The introduction of the budgeting system was an important step in the history of Indian economy, as it brought in a more systematic approach to public finance management. Some of the key benefits of the budgeting system are:

1. Transparency: The budgeting system introduced a transparent approach to public finance management, as it allowed for the proper allocation of resources and ensured that the government was accountable for its spending.

2. Prioritization: The budgeting system allowed the government to prioritize its spending based on the needs of the economy and the society.

3. Planning: The budgeting system allowed the government to plan its spending and revenue collection over a period of time, which helped in better management of the economy.

Conclusion:
In conclusion, the system of budgeting was introduced in British India in 1860, which brought in a more systematic approach to public finance management. The budgeting system has played a crucial role in the development of the Indian economy and has helped in ensuring transparency, prioritization, and planning of government spending.