What happens to the unused fund that I had allocated for trading?

Since the allocated amount does not go outside your IndusInd Bank savings account, it reflects in your account balance at the end of the day. E.g., You marked off ₹4,00,000 but used only ₹2,00,000 from it. Then the remaining ₹2,00,000 will reflect in your bank account at the end of the day.