Relative clauses in English grammar furnish supplementary details concerning a noun, without altering the sentence's core meaning. Typically, these clauses are initiated by relative pronouns such as "who," "which," or "that." A non-essential or non-restrictive relative clause, meaning the sentence remains comprehensible without it, requires punctuation with commas. This punctuation serves to delineate extra, non-crucial information that does not define the noun being described.
Within the provided sentence choices, the clause "who lives in Mumbai" functions as non-restrictive. It supplies extra information about "My sister" but is not indispensable for identifying her. Consequently, it must be demarcated by commas:
This particular option accurately employs commas to isolate the non-restrictive clause. Other options exhibit incorrect comma placement or a complete absence thereof.