The correct option is C Embryo in kernel
Gram seed is a non-endospermic and dicotyledonous type of seed.
Dicotyledonous seed does not represent embryo in kernel.
Chalaza is located opposite to micropyle opening of the integuments. It is the point where integuments and nucellus are joined. It is the point situated below the ovary.
When gram seed is soaked in water, only seed coat is removed. Dicotyledonous seeds have embryo covered with seed coat. Embryo contains an embryonal axis and two cotyledons. After the removal of seeds coat, cotyledons are exposed and part of embryonal axis, i.e., radicle protrudes outside the cotyledons.
Thus, the correct answer is option C.