Django Vercel Deployment Issue | 500: INTERNAL_SERVER_ERROR | ModuleNotFoundError: No module named 'distutils'

I have been trying to deploy a Django App on vercel, it is getting deployed but the website is not working says "This Serverless Function has crashed"

Requirements.txt

Django==3.1.12
djongo==1.3.7
dnspython==2.7.0
pymongo==3.11.4
psycopg2-binary~=2.9.6
setuptools==75.7.0

vercel.json

{
    "builds": [{
        "src": "inventory_management/wsgi.py",
        "use": "@vercel/python",
        "config": { "maxLambdaSize": "15mb", "runtime": "python3.9" }
    }],
    "routes": [
        {
            "src": "/(.*)",
            "dest": "inventory_management/wsgi.py"
        }
    ]
}

The error says,

from distutils.version import LooseVersion ModuleNotFoundError: No module named 'distutils'

Tried adding setuptools in requirements.txt but still the same issue

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