Statement - I :Coloured spectrum is seen when we look through a muslin cloth.
Statement - II :The coloured spectrum is due to diffraction of white light on passing through fine slits made by fine threads in the muslin cloth.

When we look through a muslin cloth coloured spectrum cab be seen. Because muslin cloth has fine slits in it. When white light passes through thin fine slits diffraction occurs. Due to this diffraction of light we can coloured spectrum.