how to close or deallocate cursor when it is in open state

If you use a cursor variable instead of a named cursor, then it will fall out of scope when you exit the procedure...

DECLARE @MyCursor CURSOR
SET @MyCursor = CURSOR FOR
SELECT * FROM Person.Person;

OPEN @MyCursor

...

CLOSE @MyCursor
DEALLOCATE @MyCursor

However, happy as I am to answer your question, I feel that I really should point out that you should try to avoid using a cursor at all.

I agree with Matts point - don't use cursors if you can avoid it. You probably CAN avoid it.

However, cursors exist, and sometimes they are handy. I use them sometimes, in maintenance tasks and sometimes when exporting hierarchical data to flatfiles.

I normally use a LOCAL cursor, and I try to find a cursor with as little overhead as possible.

If you declare the cursor as LOCAL, it will only exist in the stored procedure scope. The default is global.

If you only want to move forward in the cursor, and not use it for updates, you want to specify it as FAST_FORWARD as well, to avoid some of the overhead associated with cursors that allow scrolling and that are updateable.

DECLARE cur CURSOR FAST_FORWARD LOCAL FOR
SELECT something FROM someone
OPEN CUR
..

This goes for CURSOR variables as well (except the LOCAL/GLOBAL since the variable falls out of scope anyway)

Here's the Books Online T-SQL reference for DECLARE CURSOR: http://msdn.microsoft.com/en-us/library/ms180169.aspx