Hello Ray Garg,
Thank you for reaching out to Microsoft Support!
Judging from your parsed token, the permissions granted are sufficient, for this, we did the same test as you did, initially when we only granted the application permissions User.ReadWrite.All, we had the same error as you when changing the password, 403 permissions are insufficient.
According to the documentation, it is necessary to grant the application User Administrator role, for which we grant the application administrator role in Azure AD, as shown below:
After the role is granted, the token is obtained again, and the response is successful in the re-test. The test result is as shown in the following figure:
Check that the application is granted permission in Microsoft Entra ID->Roles and administrators->User Administrator.
Hope this helps.
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