The correct option is C Hay bacteria
Bacillus subtilis is also known as hay bacillus/grass bacillus. It is a small, obligate aerobic spore forming soil bacterium. It has unique ability to degrade plant polysaccharides and pectin. This makes option C correct. The chemolithotropic bacteria that convert ammonia into nitrates are termed as nitrifying bacteria; it includes Nitrosomonas and Nitrobacter. Option A is incorrect. The chemolithotrophic bacteria that reduce the nitrates into nitrogen are termed as denitrifying bacteria, e.g., Pseudomonas, Bacillus denitrificans, etc. Option B is incorrect. E. coli is also termed as colon bacterium which is a facultative parasite of large intestine/colon of mammals which makes option D incorrect. Thus, the correct answer is option C.