The principle sets a clear line, oral evidence counts only if it comes from someone who personally saw the event described, and anything passed along secondhand, however sincerely believed, is hearsay and carries no evidentiary weight.
Trace where X's knowledge actually comes from. He did not see Z murder A, what he has is Y's account of it, relayed to him because X trusts Y. That chain, event to Y's observation to Y telling X, means X's own statement in court would be reporting what Y said, not reporting what X witnessed, which is exactly the secondhand structure the principle excludes.
Neither X's trust in Y, nor X's own standing and reputation as a social activist, changes where the information originated. The test is about the source of the knowledge, direct observation versus something relayed, and on that test X's statement falls on the inadmissible side regardless of how credible X or Y might otherwise seem.
So the correct answer is Statement of X is not admissible because he has not seen Z murdering A.
Checking what fact would need to be different for each option to hold makes the source of X's knowledge decisive.
Since X's knowledge is already established as secondhand and none of the three alternative conditions actually change where that knowledge came from, the option finding the statement inadmissible is the one that fits.
Therefore, the correct answer is Statement of X is not admissible because he has not seen Z murdering A.