Hi Rajkumar,
Since the updates to cloud shell the editor capability hasn't been working properly. What you can do instead is use a different editor, Nano. You need to modify two of the steps to use Nano, as detailed below:
For Step #3, enter below command instead of what is in the exercise:
nano application.py
For Step #5, press Ctrl+S and then Ctrl+X to save file and exit Nano, instead of what is written in the exercise.
I just tested by completing the exercise using Nano and was successful.
Below is cheatsheet for Nano's shortcut keys in case you need it:
https://www.nano-editor.org/dist/latest/cheatsheet.html
Please click Accept Answer and upvote if the above was helpful.
Thanks.
-TP