Concept: A child witness is not automatically disqualified. The court must examine whether the child understands the questions and can give rational answers.
Step 1: Understand child witness competency.
Competency depends on the child's ability to understand the duty of speaking the truth and to answer questions properly.
\[
\text{Competency} = \text{Understanding + Truthfulness + Rational answers}
\]
Step 2: Understand the case principle.
In Dattu Ramrao Sakhare v. State of Maharashtra, the Court held that the evidence of a child witness can be accepted if it is reliable and the child is found competent.
Step 3: Reject wrong options.
There is no strict rule that a child must be at least 7 years old. A child is also not automatically untrustworthy.
Therefore, the correct answer is option (C).