Yes, if LB is avbl in GEN quota, it will be allotted to Sr ctzn but if not avbl, then some other berth (despite LB avbl in sr ctzn quota).
Faced this issue recently when booking for my dad & grandmother. Sr ctzn 32 seats were avbl, but it was not allotted as only grandmother was eligible for that quota & as I was booking in single PNR, it moved to GEN quota & allotted MB & SU (as only 8 berths were avbl) . Had to book then separately in sr ctzn to get 1 LB .