Hello Sreekara Yachamaneni
Welcome to Microsoft Q&A Platform, thanks for posting your query here.
When a VM is scaled down in Azure VMSS, the VM is deallocated and the local logs from the service application and monitoring application are lost. This is because the VM is no longer running and the logs are not persisted to a storage account or other location.
If you are using Azure Service Fabric to manage your VMSS, you can configure your application to use Azure Diagnostics to collect and store logs in Azure Storage. This will allow you to retain your logs even if the VM is deallocated or deleted.
You can also use Azure Monitor to collect and analyze logs from your VMSS. Azure Monitor can collect logs from multiple sources, including Azure Diagnostics, and store them in a central location for analysis and reporting.
In summary, if you want to retain your logs when scaling down your VMSS, you should configure your application to use Azure Diagnostics or Azure Monitor to collect and store your logs in a central location.
Hope that helps.