Hello @sathish@rafay.co
I would recommend you to reconcile the cluster and then try to delete it.
Try this via Azure CLI
az extension add -n aks-preview
az aks update -n clustername -g clusterresourcegroup
az aks delete -n clustername -g resourcegroup --debug
if you still cant delete please paste your debug log.
Please also check if there no existing NSGs belong to the default aks resource group or other related resources.
https://learn.microsoft.com/en-us/answers/questions/973618/aks-cannot-be-deleted-from-the-azure-ui-due-to-an
https://learn.microsoft.com/en-us/answers/questions/893384/azure-aks-cluster-is-in-failed-state