Debentures can be issued in three ways based on their issue price relative to their face value:
At Par: When debentures are issued at a price equal to their face value. For example, a debenture of ₹100 issued at ₹100.
At Premium: When debentures are issued at a price higher than their face value. For example, a debenture of ₹100 issued at ₹105. The excess amount (₹5) is called premium and is credited to Securities Premium Reserve.
At Discount: When debentures are issued at a price lower than their face value. For example, a debenture of ₹100 issued at ₹95. The shortfall (₹5) is called discount and is debited to Discount on Issue of Debentures account.
"Issue of Debenture at capital" is not a recognized method or terminology in accounting. This option appears to be either a typographical error or a distractor, as there is no such concept in the books of accounts for issuing debentures.
The correct answer is Option 2 as it does not represent any valid method of issuing debentures.