Who is the head of the State and is the highest formal authority in India?

President

The correct answer is Option2 - President

The head of the State and the highest formal authority in India is the President of India.

The important articles associated with the President of India in the Indian Constitution are:
Chapter I : The Executive

Article 52: The President of India
Article 53: Executive Power of the Union
Article 54: Election of President
Article 55: Manner of Election of President
Article 56: Term of office of President
Article 57: Eligibility for re-election
Article 58: Qualifications for Election as President
Article 59: Conditions of President’s office
Article 60: Oath or affirmation by the President
Article 61: Procedure for Impeachment of the President
Article 62: Time of holding election to fill a vacancy in the office of President and the term of office or person elected to fill a casual vacancy