Why does the phone asks for PUK Code?

You can Lock your device's SIM cards to prevent someone else from using them. After you set it up, you'll need to enter a PIN on the lock screen for each SIM that's locked.

Below mentioned are some of the cases when your device ask for PUK code:

a). Post more than 3 wrong attempts of PIN, the phone will ask for PUK
 
b). Post multiple wrong attempt of PUK, the phone will ask for PUK 2
 
c). Post wrong PUK 2 attempt, the SIM would be no longer functional. Get in touch with Service Provider. 

  
NOTE: For information about PIN 2, PUK and PUK 2, call service provider.