When I enter description of MR, write /close <#issue_id>, and hit Create MR, what gets closed? Created MR instead of referenced issue.
If you’d like your Merge Request to close a related issue when merged, automatically, then just mention “Closes #”: Managing issues | GitLab
Do not use the /close quick action command instead, it’s feature/intention is something entirely else than what you are trying to do: GitLab Quick Actions | GitLab