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      Question

      Where neither party any appropriation, the payment shall

      be applied:ย 
      A If the debts are of equal standing, the payment shall be applied in discharge of each proportion ably. Correct Answer Incorrect Answer
      B In discharge of the debts in order of time. Correct Answer Incorrect Answer
      C Whether they are or are not barred by the law in force for the time being in as to the limitations of suits. Correct Answer Incorrect Answer
      D All of the above. Correct Answer Incorrect Answer
      E None of the above. Correct Answer Incorrect Answer

      Solution

      Section 59-61 of the Indian Contract Act deal with appropriation of payments. If neither party makes an appropriation: โ€ข If debts are of equal standing, payments are applied proportionately. Otherwise, payments are applied in order of time, regardless of limitation period. All these rules apply simultaneously.

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