The receiving host is informing the sending host it's unable to accept any additional data. If this is seen, it's likely the receiving host does have some buffer space but is trying to avoid the TCP "silly window syndrome".

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The reason for this happening is the receiving host can't keep up with the sending host's tranmission rate. This shouldn't be common since most network media is generally "slower" compared to processing performance of most modern hosts. However, as also noted by Dave, a very busy host might be unable to keep up with incoming network data.