Hey Hi. As you have already sold the CE, you would have received the premium of Rs.65,000(500Qty * Rs.130). When you short CE, your view is bearish and you expect the market you stay below 3400, if it does, the premium you collected is your maximum profit.
If the market expires at 3600 as you said, your CE becomes ITM, and you are required to give delivery of the 500Qty underlying for the price of Rs.3400(Strike price).
In this case, as said, you are required to give delivery of 500Qty underlying for the price of Rs.3400, so the total sale proceeds you receive is Rs.17,00,000.
You won’t realize the loss made in the position, but due to the physical delivery you have sold the stocks for a lesser price than the market price. So that’s the loss.
Thats, right. You will receive Rs.17 lakhs and you are required to give delivery of 500Qty Adanient. In case, if you don’t have the stocks, then you won’t be able to fulfill the obligation and the transaction will get settled in the auction market. Refer to this Z-Connect article to know more about the consequences of short delivery.
Your sell average price will be the CE strike price.
Hope this helps! But yeah, feel free to ask questions.