Correct option is A
Penalise (verb) – to punish or subject to a penalty.
Example: "The referee penalised the player for a foul."
Synonyms: punish, fine, discipline, sentence. Antonyms:
legalise (correct answer), allow, permit, authorise.
Legalise (verb) – to make something lawful.
Example: "The government decided to legalise online gaming."
Other
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Forbid means to prohibit or ban. (Not opposite to penalise.)
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Veto means to reject a decision or proposal. (Not opposite, but related.)
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Outlaw means to make something illegal. (Similar to penalise, not opposite.)