SparseCategoricalcrossEntropy(from_logits=True) internally apply softmax?

Yes, Softmax function is called when logit=True

Infact, if we check the keras code [Link], the softmax output is ignored in every condition and tf.nn.sparse_softmax_cross_entropy_with_logits is called. This function calculate softmax prior to cross_entropy as explained [Here]

I suppose applying softmax would not be required internally as taking argmax would give the index expected.

Predicting the class is not the only task here. It has to calculate the appropriate loss value to provide feedback to the network
If the target is in probability values[OHE] i.e. sum=1, not an open-ended logit i.e. [-inf, inf]. So the output should be similarly normalized prior to the loss calculation.