M1 MacBook waking up from sleep on lid close

Hi, I have a MacBook Pro M1 Max running Sonoma latest, Recently I noticed an issue with my macbook not going to sleep when I close the lid. I investigated further when I close the lid and when it is about to completely close the macbook does actually goes to sleep but once it is completely closed it wakes up again. So in short if I close the lid , it will go to sleep when the lid if about to be fully closed but then wakes up once it is closed. I can notice the light from or If I am watching netflix the movie gets paused for a second and then resumes when the lid if fully closed.

Also, If I put the macbook on sleep with open lid it goes to sleep normally so there is no issue there but if in its sleep state I close the lid again it will wake up. It is like closing the lid fully is causing it to wake up.

I have restarted / shutdown and restart mayn times and, I keep it all clean so there is no issue of any key being pressed by the screen. Most of my use is for work using an external monitor so It is usually in clamshell mode and I only use it on the weekends. also in clamshell mode now I have started noticing in settings -> display it shows MacBook internal display, This wasn't happening before so I can say that this is fairly recent and seemingly no update is responsible for it.

If anybody could help me out with this that would be awesome.

Many Thanks