Explanation:

- Option 1: Bal Gangadhar Tilak was a prominent leader in the Indian independence movement but did not serve as the President of the Indian National Congress in 1887.

- Option 2: Badruddin Tyabji was indeed the third President of the Indian National Congress. He presided over its third session in 1887 in Madras, making him the first Muslim to hold this position.

- Option 3: W.C. Bannerji was actually the first President of the Indian National Congress, serving in 1885.

- Option 4: Dadabhai Naoroji was another key leader and also served as the President of the Indian National Congress, but not in 1887.