The irrigation device called 'Araghatta' was

1. A

   a water bag made of leather pulled over a pulley

   A leather bag over a pulley. That is the mot / charsa neighbourhood, not araghatta as keyed.

2. B

   a large wheel with earthen pots tied to the outer ends of its spokes

   A large wheel with earthen pots on the outer ends of its spokes. That is the official identification of araghatta (the Persian-wheel type noria).

3. C

   a larger earthen pot driven by bullocks

   A large earthen pot driven by bullocks. Not the wheel-and-pots machine.

4. D

   a large water bucket pulled up by rope directly by hand

   A bucket pulled up by hand. The coaching trap if you read araghatta as a simple well-bucket.

Summary. Official Set A key is (b). Araghatta in the Indian irrigation record is the pot-garland wheel: a large wheel, pots on the rim, turned to lift water — the Persian-wheel picture. A leather bag on a pulley, a bullock-pot, or a hand bucket are neighbouring lift devices, not the official letter here.