As you can see in the above, there is no error details, but when I tried to look based on the error code, I found below link
But it seems this KB is not updated as currently Dynamics 365 CE supports
And all of our assemblies was referencing correct .net version.
While trying troubleshooting, I tried to check solution list in the target organization and I found plugin profiler solution is installed in the target organization. And when I removed plugin profiler from target organization, I was able to import solution without any issue.
So if you are getting this error one potential issue could be plugin profiler if it is installed in the target organization. Remove it and try to install it again.
Hope it will help someone!
Keep learning, Keep sharing !!