How can we reset the IDENTITY value?

You can reset the identity column in SQL server value by

  DBCC CHECKIDENT('tableName', RESEED, 0)

So next time you insert into TableName, the identity value inserted will be 1. When you delete rows from the table, it will not reset the Identity value, but it will keep increasing it. Just like what happened in your case. Now when you truncate the table, it will reset the Identity value to its original Seed value of the table.

  Refer to: SQL SERVER – DELETE, TRUNCATE and RESEED Identity for a detailed example and some good explanation of the difference between Truncate and Delete