Using BJT emitter follower after microcontroller
The Plain Old Telephone Service (POTS) telephone system signalled dialling by connecting together the two phone line wires with a series of pulses. The rotary dial was pulled round to the required digit and released to slowly trawl back to the rest position. As it trawled back, it generated a series of loading pulses across the phone line, representing one pulse per digit dialled. So dialling 9 would generate 9 pulses on the way back to the rest position. This was the case for decades, long before the tone-pulse scheme of DTMF came along.

Have a read of www.britishtelephones.com/howtele.htm, it'll go over this in more detail.

The wires had around 50 V across them when unloaded and the phone dialling pulses loaded them. Your BJT is there to connect such a load to a line voltage far higher than your microcontroller could take and draw a current it couldn't handle.

The microcontroller supply comes from the line, using that simple Zener regulator. It's large capacitor is intended to hold up the microcontroller's supply while the line is dragged down by the dialling pulses.