Explanation

Mr. Ajit's father's wife is his mother, and his mother's son is either Ajit himself or his brother. That son's only sister is the daughter of the same parents, which makes her Mr. Ajit's own sister. She cannot be his daughter (wrong generation), his mother's sister (that would be his aunt), or his cousin (that would be an uncle's or aunt's child). Hence the person in the photograph is his sister.