Let us break the overall reaction sequence into two steps:
\begin{itemize}
\item The forward reaction converts \ce{C6H5CH2NH2} (benzylamine) to \ce{C6H5CONH2} (benzamide). This is an oxidation process, converting a primary amine to an amide.
\item However, since the direction of the reaction is indicated as \ce{C6H5CH2NH2 ⇔C6H5CONH2}, it implies that X is a reagent that helps in converting \ce{C6H5CH2NH2} to \ce{C6H5CONH2}, i.e., it involves oxidation, and the reverse of reduction.
\item But in the given context, more clearly: X is LiAlH\textsubscript{4, H\textsubscript{2}O} used to reduce benzamide (\ce{C6H5CONH2}) back to benzylamine (\ce{C6H5CH2NH2}). So the left-to-right direction is amide to amine, which is a reduction by LiAlH\textsubscript{4}.
\item For the second part, converting \ce{C6H5CONH2} to \ce{C6H5NH2} (aniline) removes the -CO part and replaces the amide with a direct amine. This is the classic Hofmann bromamide reaction (also called Hofmann rearrangement).
\item Hofmann bromamide reaction is done using Br\textsubscript{2}/OH\textsuperscript{–} to convert an amide to a primary amine with one carbon less.
\end{itemize}
So, the correct reagent sequence is:
\begin{align*}
X &: \ce{LiAlH4, H2O} \quad \text{(reduction of amide to amine)}
Y &: \ce{Br2 / OH^-} \quad \text{(Hofmann rearrangement of amide to amine)}
\end{align*}
\[
\boxed{\text{Correct Answer: (1)}}
\]