Step 1: Understanding the question.
The question asks about the smallest Union Territory of India in terms of geographical area. Step 2: Analyzing the options. (A) Andaman and Nicobar Islands: This is one of the largest Union Territories by area. (B) Lakshadweep: Correct — Lakshadweep has the smallest land area among all Union Territories of India. (C) Chandigarh: Chandigarh is small but larger than Lakshadweep in area. (D) Dadra and Nagar Haveli: This Union Territory has a larger area than Lakshadweep. Step 3: Conclusion.
The smallest Union Territory in India is Lakshadweep.