1. What happens when I exit a profitable short options position?

The total option premium was credited to your Tradejini account in the bill pertaining to the day of shorting an option. When you exit your short by buying the option the premium at which it is bought back will be debited to your Tradejini account. Hence the funds debit or credit in the ledger does not depend on your profit or loss in these transactions.

2. What happens if I hold the position till expiry?

If you decide to hold the position until expiry and the premium becomes 0, you get to keep the entire premium received during shorting as a profit. This only happens if the position expires Out of The Money (OTM). 

3. What if the position expires In The Money (ITM)?

Stock Options If the position expires ITM, you have two options:

Give Delivery: For short call options, you need to deliver the stock. However, if you don't have the stocks in the demat account, there will be a short delivery, incurring a short delivery penalty.

Take Delivery: For short put options, you need to take delivery of the stock. If you don't have sufficient funds, it results in a debit balance in your trading account.

Index Options: If the position expires ITM, index options will be cash-settled. The remaining amount will either be debited or credited to your trading account after the daily settlement process.