Azure AD Conditional Access Not Applying

We are using Azure AD to configure SSO in Jupter Hub, which is deployed in AKS. SSO is working fine and we are able to login with our Azure AD Account.

But the Conditional Access policy applied to the JupterHub AAD app registration is not getting applied. We are using conditional access policy to apply MFA for few Azure AD users.

Jupterhub chart version : jupyterhub-0.10.6
Azure kuberenets version: 1.19.7
Hub version : jupyterhub/k8s-hub: 0.10.6-n211.h2e3a73af

SSO Configuration

auth:
  admin:
    users:
      - 'user1'
      
  type: custom
  custom:
    className: "oauthenticator.azuread.AzureAdOAuthenticator"
    config:
      client_id: ""
      client_secret: ""
      oauth_callback_url: "https://xxxxxxxx.com/dslab/hub/oauth_callback"
      tenant_id: ""