java - Why does the specified object be eligible for garbage collection?

There's a difference between pass-references-by-value and pass-values-by-reference :)

Is Java Pass By Reference
Java is never pass by reference right right
Pass By Reference Or Pass By Value

You might want to check out Jon Skeet's article on C# parameter-passing semantics as well, seeing as it's his favorite 'programmer ignorance' pet peeve:
What's your favorite 'programmer ignorance' pet peeve.

So basically, I see your code do the following:

c1 = new C("Alice");
    // m1(C obj1) {     -- c1 gets passed to m1, a copy of the reference is made.
    //                  -- there are now two references to Alice (c1, obj1)
    //    obj1 = new C("Bob"); -- there is now one reference to Alice
                                // and one reference to Bob
    //    return obj1;  -- returns a reference to Bob(c1 still reference Alice)
    // }                -- when m1 returns, one of the references to Alice disappears.
c2 = m1(c1); // c2 points to Bob 
c3 = new C("Charlie");

c2 = c3;      // <-- Bob is eligible for collection. 
              // There are now two references to Charlie