Azure Resource Manager deployment gives 503 Server timeout error

Question

We are using Azure Resource Manager template to deploy resources in our Azure subscription, the template simply create virtual machine and required networking resources. That same template and its deployment had been working as expected for quite some time, but has started to fail recently with a 503 Server timeout error. Here's the template:

{  
    "$schema": "http://schema.management.azure.com/schemas/2015-01-01/deploymentTemplate.json#",  
    "contentVersion": "1.0.0.0",  
    "parameters": {  
        "location": {  
            "type": "string",  
            "defaultValue": "useast2"  
        },  
        "VirtualNetworkId":{  
            "type": "string",  
            "value": "<vnet-resource-id>"  
        },  
        "subnetName": {  
            "type": "string",  
            "value": "<subnet-name>"  
        },  
        "identifier": {  
            "type": "string",  
            "value": "<identifier>"  
        },  
        "virtualMachineName": {  
            "type": "string",  
            "value": "<identifier>"  
        },  
      "adminPublicKey": {  
        "type": "string",  
        "defaultValue": "<public-key>",  
        "metadata": {  
          "description": "Specifies the SSH rsa public key file as a string. Use \"ssh-keygen -t rsa -b 2048\" to generate your SSH key pairs."  
            }  
        },  
        "virtualMachineSize": {  
            "type": "string",  
            "defaultValue": "Standard DS1 v2"  
        },  
        "adminUsername": {  
            "type": "string",  
            "defaultValue": "ubuntu"  
        }  
    },  
    "variables": {  
        "networkSecurityGroupName": "[concat(parameters('virtualMachineName'), '-SecurityGroup')]",  
        "nsgId": "[resourceId(resourceGroup().name, 'Microsoft.Network/networkSecurityGroups', variables('networkSecurityGroupName'))]",  
        "vnetId": "[parameters('VirtualNetworkId')]",  
        "vnetName": "[last(split(variables('vnetId'), '/'))]",  
        "subnetRef": "[concat(variables('vnetId'), '/subnets/', parameters('subnetName'))]",  
        "publicIpAddressName": "[concat(parameters('virtualMachineName'), '-PublicIPAddress')]",  
        "networkInterfaceName": "[concat(parameters('virtualMachineName'), '-NetworkInterface')]"  
    },  
    "resources": [  
        {  
            "name": "[variables('networkInterfaceName')]",  
            "type": "Microsoft.Network/networkInterfaces",  
            "apiVersion": "2021-03-01",  
            "location": "[parameters('location')]",  
            "dependsOn": [  
                "[concat('Microsoft.Network/networkSecurityGroups/', variables('networkSecurityGroupName'))]",  
                "[concat('Microsoft.Network/publicIpAddresses/', variables('publicIpAddressName'))]"  
            ],  
            "properties": {  
                "ipConfigurations": [  
                    {  
                        "name": "ipconfig1",  
                        "properties": {  
                            "subnet": {  
                                "id": "[variables('subnetRef')]"  
                            },  
                            "privateIPAllocationMethod": "Dynamic",  
                            "publicIpAddress": {  
                                "id": "[resourceId(resourceGroup().name, 'Microsoft.Network/publicIpAddresses', variables('publicIpAddressName'))]"  
                            }  
                        }  
                    }  
                ],  
                "networkSecurityGroup": {  
                    "id": "[variables('nsgId')]"  
                }  
            }  
        },  
        {  
            "name": "[variables('networkSecurityGroupName')]",  
            "type": "Microsoft.Network/networkSecurityGroups",  
            "apiVersion": "2019-02-01",  
            "location": "[parameters('location')]",  
            "properties": {  
                "securityRules": [  
                  {  
                    "name": "SSH",  
                    "properties": {  
                      "priority": 1000,  
                      "protocol": "Tcp",  
                      "access": "Allow",  
                      "direction": "Inbound",  
                      "sourceAddressPrefix": "*",  
                      "sourcePortRange": "*",  
                      "destinationAddressPrefix": "*",  
                      "destinationPortRange": "22"  
                    }  
                  },  
                  {  
                    "name": "AllowTraffic",  
                    "properties": {  
                      "priority": 1010,  
                      "protocol": "Tcp",  
                      "access": "Allow",  
                      "direction": "Inbound",  
                      "sourceAddressPrefix": "*",  
                      "sourcePortRange": "*",  
                      "destinationAddressPrefix": "*",  
                      "destinationPortRange": "*"  
                    }  
                  }    
                ]  
              }  
        },  
        {  
            "name": "[variables('publicIpAddressName')]",  
            "type": "Microsoft.Network/publicIpAddresses",  
            "apiVersion": "2019-02-01",  
            "location": "[parameters('location')]",  
            "properties": {  
                "publicIpAllocationMethod": "Static"  
            },  
            "sku": {  
                "name": "Basic"  
            }  
        },  
        {  
            "name": "[parameters('virtualMachineName')]",  
            "type": "Microsoft.Compute/virtualMachines",  
            "apiVersion": "2021-07-01",  
            "location": "[parameters('location')]",  
            "identity": {  
             "type": "SystemAssigned"  
             },  
            "dependsOn": [  
                "[concat('Microsoft.Network/networkInterfaces/', variables('networkInterfaceName'))]"  
            ],  
            "properties": {  
                "hardwareProfile": {  
                    "vmSize": "[parameters('virtualMachineSize')]"  
                },  
                "storageProfile": {  
                    "osDisk": {  
                        "createOption": "fromImage",  
                        "deleteOption": "Delete",  
                        "managedDisk": {  
                            "storageAccountType": "StandardSSD_LRS"  
                        },  
                        "diskSizeGB": 30  
                    },  
                    "imageReference": {  
                        "publisher": "canonical",  
                        "offer": "0001-com-ubuntu-server-focal",  
                        "sku": "20_04-lts-gen2",  
                        "version": "latest"  
                    }  
                },  
                "networkProfile": {  
                    "networkInterfaces": [  
                        {  
                            "id": "[resourceId('Microsoft.Network/networkInterfaces', variables('networkInterfaceName'))]"  
                        }  
                    ]  
                },  
                "osProfile": {  
                    "computerName": "[parameters('virtualMachineName')]",  
                    "adminUsername": "[parameters('adminUsername')]",  
                    "linuxConfiguration": {  
                        "disablePasswordAuthentication": true,  
                        "ssh": {  
                            "publicKeys": [  
                                {  
                                    "path": "[concat('/home/', parameters('adminUsername'), '/.ssh/authorized_keys')]",  
                                    "keyData": "[parameters('adminPublicKey')]"  
                                }  
                            ]  
                        }  
                    }  
                },  
                "diagnosticsProfile": {  
                    "bootDiagnostics": {  
                        "enabled": true  
                    }  
                }  
            }  
        }  
    ],  
    "outputs": {  
        "adminUsername": {  
            "type": "string",  
            "value": "[parameters('adminUsername')]"  
        }  
    }  
}  

ARM Create Deployment API was used from the documentation page try it option.
Here are the results of a sample deployment:

Response Body:

{  
  "error": {  
    "code": "ServerTimeout",  
    "message": "The request timed out. Diagnostic information: timestamp '20220327T155727Z', subscription id '6df48df0-802d-4891-9f31-7cc1879f3cb4', tracking id '485d1bc6-777f-4696-8f40-d347da31234d', request correlation id '485d1bc6-777f-4696-8f40-d347da31234d'."  
  }  
}  

Any help would be greatly appreciated.
Thanks,