Hi @Shruti Gupta3 , welcome to Microsoft Q&A forum.
<Writing in answer section as it is crossing 1000 words limit of comment>
Complementing @SUNOJ KUMAR YELURU , "Initiating scale up or scale down action in any of the flavors would restart database engine process and move it to a different virtual machine if needed. Moving database engine process to a new virtual machine is online process where you can continue using your existing Azure SQL Database service while the process is in progress. Once the target database engine is fully initialized and ready to process the queries, the connections will be switched from source to target database engine."
Regardless, the switch can result in a brief service interruption when the database is unavailable generally for less than 30 seconds and often for only a few seconds. If any transaction happens within this brief period of time, that will be rolled back. To handle the rollback one way is to have retry logic in the application which would keep on retrying the connecting until the connection is up. If we don't have the retry logic and cannot take the risk of losing the data within those brief period, we might need to stop the service and start it again once it is up."
Scale single database resources in Azure SQL Database
Dynamically scale database resources with minimal downtime