The correct answer is option 3 - Parliament. In India, residual powers refer to the powers that are not mentioned specifically in the Constitution and are not assigned to any level of government. These powers are retained by the central government, which is represented by Parliament.

Option 1 - President: The President of India does not have residual powers of legislation. The President`s role is primarily ceremonial, and they exercise limited powers and functions as prescribed by the Constitution.

Option 2 - Prime Minister: The Prime Minister is the head of the government, but they do not have residual powers of legislation. Their role is to lead the executive branch and coordinate the functioning of the government.

Option 4 - States: The states in India have their own legislative powers but do not possess the residual powers of legislation.

Therefore, Parliament, which is the supreme legislative body in India, holds the residual powers of legislation.