Following Journal entry is passed in case of:

Debenture Application and Allotment A/ c Dr.
Loss on Issue of Debenture A/c Dr.
          To Premium on Redemption of Debentures A/c
          To Debentures A/c

When debenture are issued at discount and redeemed at Premium

The correct answer is Option (2) → When debenture are issued at discount and redeemed at Premium.

Issue at discount and redemption at premium-

Bank A/c Dr.
    To Debenture Application & Allotment A/c
(Receipt of application money)

Debenture Application & Allotment A/c Dr.
Loss on Issue of Debentures A/c Dr.  (with discount on issue plus premium on redemption)
      To Debentures A/c (with nominal value of debenture)
      To Premium on Redemption (with premium on redemption) of Debentures A/c
(Allotment of debentures at a discount and redeemable at premium)