When debentures are issued at par and are redeemable at a premium, the loss on such issue is debited to:

Loss on issue of debentures account

The correct answer is option 3- Loss on issue of debentures account.

The premium on redemption represent losses to the company. These are capital losses, and are accumulated under one accounting head: "Loss on Issue of Debentures Account". So, when debentures are issued at par and  redeemed at a premium, the Loss on Issue of Debentures A/c is debited. 

Journal entry for the issue at par and redemption at premium-

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

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