Hi @nishithakomma,
there shall be no limitation for this state flow, try to refresh the page and change it once again.
If it still not work, then Incidents in On Hold state have displayed a On Hold Reason field and this field is mandatory. So perhaps there is some discrepancy about this, If the On Hold Reason is Awaiting Caller, then Additional comment is mandatory etc...
Try to open that particular incident and check for the value in OHR field and eventually select any value, then go back to the list view or update the incident form directly.
Let me know if this helped you to unblock it! Also, I can see that your screenshot's profile picture is System Admin, some of the labs are required to be performed by a Platform User ensure that you have the right user or eventually impersonate for it.
Good luck!
