The correct option is D Mr. Vidyapati Sridhar, the principal of that school, has been transferred to Chennai.
While punctuating a sentence it is important to capitalize the proper nouns such as the name of a person, place or organization and the titles used to address people such “Mr.”, “Ms.” etc. Hence in the given sentence, ‘Mr.” the first letters of “Vidyapati” and “Sridhar” have to be in uppercase. Thus option A is incorrect. Similarly, the words that occur in the middle of a sentence should all be in lowercase, except when it is a proper noun. Therefore the first letter of “transferred” should not be in uppercase since it is a verb and not a proper noun. Hence option B is incorrect. Further, a comma is used to indicate the separation of ideas or elements and to differentiate the different parts of a sentence, to avoid confusion while reading. In the given sentence a comma has to be placed after ‘Sridhar’ and before the main verb “has been transferred” to set off the words that are not essential for the meaning of the sentence, from the subject and verb clause. Thus option D is correct whereas option C is incorrect.