Step 1: Identify the reaction type.
Benzene diazonium chloride reacts with ethanol in a reduction reaction.
Step 2: Reaction explanation.
Ethanol acts as a reducing agent and replaces the diazonium group \((\mathrm{-N_2^+Cl^-})\) by hydrogen, leading to the formation of benzene.
Step 3: Conclusion.
Therefore, benzene diazonium chloride on reaction with ethanol forms benzene.