First, this is no memory leak.
Second, when you close a stream wrapper, the default implementation is for it to close the stream that it wraps. This means that the first time you close your Scanner (as it is written), yes, you close System.in.
In general, one would like to avoid closing System.in if they were meaning to read from System.in again. The best way to go about this depends on your program.
One might copy the information from System.in into a buffer of some sort and then scan the buffer. One might not close the Scanner, reusing it in other locations. One might even de-reference the Scanner for garbage collection and create multiple new Scanners on System.in.
These solutions are not all equivalent, some are considered much better than others; but, it all depends on the calling program. Experiment with a few, and if you run into a problem, open a new StackOverflow question where you show the relevant portions of your code, a description of the problem, the example input, and the wrong output (along with the desired output).
Good luck.