It looks too small to be covering a plug.... Could it be a bung for the plug hole to stop moisture/muck getting in. Maybe due to parts shortages or perhaps a little oil was dropped in before the plug was finally fitted for the road test?
I have a feeling that plugs may have been fitted at Army Ordnance depots.....part of the maintenance and preparation tasks routinely carried out....
Many bikes, particularly late-war production, sat in Depots for months and months, many ultimately not being issued prior to disposal.....
The M20's featured are reasonably late-production (1943 - 44), so some from this contract may have remained in storage....although photographic evidence definitely shows some in service in NW Europe circa 1944-45.....
Oddly enough, many years ago now I had an M20 from this contract (C 5126292)......wonder where she is now ? She had been used post-war, still retaining the post-war numberplate on the rear when acquired as a wreck back in the 1980's.....