It's from a plug at the muzzle, mud or snow and it's common. I've seen lots. M1rifles, 1903 Springfield, 92 Winchester, Model 12 Winchester shotgun...I can go on. I had a Krag rifle with a bulge at the muzzle like that and didn't detect it because the bore was dark. It shot 3ft high to 11 O'clock at 100 yds. Right at the very crown... A friend had a Husqvarna sporter in .308 with a bulge at the crown from probably snow since he lived in the east, he swore it shot tiny tight groups.
Only thing to do if it's off it counter bore. You could turn the muzzle down to take a bayonet too. Just a simple obstruction bulge.