Customers today enjoy the benefit of margin if the trades are hedged. Going forward if you square off the hedge position then it is important to square off the leg of the transaction which has higher margin requirements first. If this sequence is not followed, your peak margin requirement may shoot up and if sufficient margin is not available, it may lead to a penalty that has to be borne by you. For E.g. You have only Rs.50000 as an available margin. Now you buy 1 Lot of NIFTY 13500 CE @ Rs.30 and then sell 1 lot of NIFTY 13700 CE; the margin requirement to hold these positions is around 25000/. Now if you square off NIFTY 13500 CE, and the margin requirement for NIFTY 13700 CE will increase to Rs.1,60,000. Since you only have Rs.50000 as a margin this will lead to a shortfall and attract a penalty.