How to overlay a client library in AEM?

Clientlibs folders located below /apps take precedence over same-named folders that are similarly located in /libs path.

For example, /apps/cq/ui/widgets takes precedence over /libs/cq/ui/widgets. When these libraries belong to the same category, the library below /apps is used.
After overlay, if you have js.txt at both places (/apps and /libs) it will load clientlibs twice. To avoid, make sure you remove js.txt from the destination (/apps in this case)