Yes, you should report in the college within given time  and if you dont report, your security deposit will not be refunded. Free exit options is not possible with 2nd round of Counselling. But there exit with forfeiture which means that Candidate who doesnt want to join the allotted seat can exit the seat by forfeiting the security deposit. It is 10,000Rs for Government Colleges and 2,00,000Rs for Deemed Universities. You can get the complete information at https://mcc.nic.in/UGCounselling/Documents/FAQMCCUG2019.pdf