Correct option is A
From the above statement following Venn diagram will be -

(I) No watch is a phone. (False, This means all watches are also phones (since watches are inside dials, and dials are inside phones).
The conclusion "No watch is a phone" directly contradicts this fact.)
(II) Some dials are mobiles. (False, Since it is not explicitly stated that any dials are mobiles, we cannot conclude this with certainty.