The claims arising out of the matters specified in the Schedule shall have priorities in accordance with the following principles, namely :--
(a) category I will have precedence over all other categories and category II will have precedence over category III, and so on;
(b) the claims specified in each of the categories, shall rank equally and be paid in full, but, if the amount is insufficient to meet such claims in full, they shall abate in equal proportions and be paid accordingly;
(c) the question of discharging any liability with regard to a matter specified in a lower category shall arise only if a surplus is left after meeting all the liabilities specified in the immediately higher category.