@Prakhar_Agrawal margin penalty is levied on overnight positions in case your unencumbered or free balance is not sufficient to fulfill the total margin requirement (SPAN +Exposure). It is not necessary that the penalty is charged only when you have a debit balance in your ledger, as it includes unsettled credits as well (For eg: the credit from the sale of equity shows up on the T day itself whereas the funds actually hit your trading account on T+2). You may go through this support article to know more. A comprehensive explanation is provided by @VenuMadhav in the below post.
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