The correct answer is: C. Both 1 and 2
The town of Kasauli was established in 1819 by Colonel Ochterlony, the British Resident at the court of the Sikh Maharaja Ranjit Singh. It was originally a small village called Dag-e-Shai, which means “Hill of Tea” in Persian. The British built a sanatorium in Kasauli, and it soon became a popular hill station for British colonials. After Indian independence in 1947, Kasauli became a popular tourist destination for Indians.
Dag-e-Shai was a group of 5 villages: Kasauli, Dagshai, Kandaghat, Solan and Rajgarh. The British built a sanatorium in Kasauli, and the other villages gradually grew around it. Today, Kasauli is a town with a population of over 10,000 people. It is a popular tourist destination for its scenic views, colonial architecture and mild climate.