If a person enters the mosque and is praying the sunnah while the
iqamah is called, then the best opinion in this case is that if he is in
his second rak‘ah, he should shorten it, and if he is in the first
rak‘ah, he should just break his prayer and enter the congregation
with the Imam1. The evidence for this comes from what Imam
Muslim has narrated in his Sahih:
Prophet
(peace be upon him) said: If iqamah is
called for the prayer then there is no prayer except the
obligatory one.
(Sahih Muslim, 1/493)
So, if one has performed the ruku‘ for the second rak‘ah, then he
should complete the prayer, and if not, then he should discontinue
because what is left from his sujud and tashahhud is not needed any
more. Moreover, he should break without salaam, and it is enough
to have the intention in the heart, contrary to common
misconception.