Azure availability zones are physically separate locations within each Azure region that are tolerant to local failures.
When you create a VM without the Availability Zone or Availability Set, it is not possible to configure the vm for the VMSS (Virtual Machine Scale Set) which is the high availability of your VM.
- The error you mentioned is because at the time of allocation there were no resources available in that zone
If use Availability Set.
try to Navigate to Home > Virtual machines, add an Availability set filter and then select Group by availability set. Select all applicable VMs and click Start. This will make sure that a new allocation attempt is run and that a new cluster can be selected that has sufficient capacity.
If you are using availability zones, try another zone within the region that may have available capacity for the requested VM size.
Reference: https://learn.microsoft.com/en-us/troubleshoot/azure/virtual-machines/allocation-failure
Reference: https://learn.microsoft.com/en-us/azure/availability-zones/az-overview
Best