ParseError: Colon is expected (svelte with scss style) svelte unit testing

I am trying to write a test for the component which is using SCSS as default styling. But the test is throwing error that it's not able to understand SCSS

myComponent.svelte

<div>Hello <span>world</span></div>
<style>
div {
 padding: 20px;
 span {
  font-weight: bold;
 }
}
</style>

Test File

// mycomponent.test.js
import { render } from '@testing-library/svelte';
import MyComponent from './MyComponent.svelte';
...
const { component } = render(MyComponent, {});
...

Jest Config

module.exports = {
  transform: {
    '^.+\\.js$': 'babel-jest',
    '^.+\\.svelte$': ['svelte-jester', { preprocess: true, debug: true }],
  },
  moduleFileExtensions: ['js', 'svelte'],
  roots: ['<rootDir>/app/modules'],
  modulePaths: ['<rootDir>/app/modules'],
  moduleDirectories: ['node_modules', 'app/modules'],
  setupFilesAfterEnv: [
    '<rootDir>/app/modules/tests/setupTest.js',
    '@testing-library/jest-dom/extend-expect',
  ],
  clearMocks: true, // Automatically clear mock calls and instances before every test.
};

I am setting the default style to SCSS in the svelte config

svelte.config.js

const preprocess = require('svelte-preprocess');

module.exports = {
  preprocess: preprocess({ defaults: { style: 'scss' } }),
};

Error Stack

Colon is expected
4:     padding: 20px;
5: 
6:     span {
              ^
7:       font-weight: bold;
8:     }
ParseError: Colon is expected

      at error (node_modules/svelte/src/compiler/utils/error.ts:25:16)
      at Parser$1.error (node_modules/svelte/src/compiler/parse/index.ts:101:3)
      at Object.read_style [as read] (node_modules/svelte/src/compiler/parse/read/style.ts:31:11)
      at tag (node_modules/svelte/src/compiler/parse/state/tag.ts:189:27)
      at new Parser$1 (node_modules/svelte/src/compiler/parse/index.ts:53:12)
      at parse (node_modules/svelte/src/compiler/parse/index.ts:218:17)
      at Object.compile (node_modules/svelte/src/compiler/compile/index.ts:93:14)
      at compiler (node_modules/svelte-jester/dist/transformer.cjs:135:32)
      at Object.processSync [as process] (node_modules/svelte-jester/dist/transformer.cjs:111:12)
      at ScriptTransformer.transformSource (node_modules/@jest/transform/build/ScriptTransformer.js:464:35)

To reproduce clone and run this repo https://github.com/rparsh/svelte-testing-scss