Hello @Sahid Afridi Thank you for reaching out to us on Microsoft Q&A platform. Happy to help!
I understand that you are trying to set up Azure Migrate project with unified set up tool and it is failing at IIS check. I see that you mentioned installing the Azure Migrate appliance on Windows Server 2016. However, as per documentation - https://learn.microsoft.com/en-us/azure/migrate/migrate-appliance "If you run the appliance on an existing server, make sure that it is running Windows Server 2022, and meets hardware requirements.
(Currently the deployment of appliance is only supported on Windows Server 2022.)"
This could be one of the reasons why it is failing at prerequisite check.
Hope this helps!