The correct answer is option 1, acceptance of deposits. Commercial banks in India perform various functions, and one of these functions is acting as an agency for accepting deposits from individuals and businesses.

Option 2, investment of surplus funds, is not considered an agency function of commercial banks. While banks do invest their surplus funds to generate income, this is not specifically classified as an agency function.

Option 3, acceptance of income tax payments, is also not an agency function of commercial banks in India. While banks may offer the facility to pay income tax through their branches, this is a service provided to customers and not a core agency function.

Option 4, providing overdraft facilities, is also not an agency function of commercial banks. Providing overdraft facilities is a lending service offered by banks to their customers, allowing them to withdraw more money than they have in their accounts, subject to certain conditions.

Therefore, the correct answer is option 1, acceptance of deposits, as it is a primary agency function performed by commercial banks in India.