Why rsync failing with an error message "rsync error: error in rsync protocol data stream (code 12) at io.c(463) [sender=2.6.8]"

Issue

• Running rsync form the system is failing with an error message rsync error: error in rsync protocol data stream (code 12) at io.c(463) [sender=2.6.8].

[user@example ~]$ rsync -ahe ssh /home/user/dir 192.168.0.1:/test
user@192.168.0.1's password:
rsync: connection unexpectedly closed (0 bytes received so far) [sender]
rsync error: error in rsync protocol data stream (code 12) at io.c(463) [sender=2.6.8]