Strange Tar behavior with -C option - tar

Question

I am trying to create a tar archive using -C option. I also am using $(ls ) to make sure that tar does not complain about missing files.
I am seeing a strange behavior that the command works when run from some paths and not from others. I am unable to explain this.
What I want to tar: /opt/server/nginx/etc/nginx/nginx.conf
[In this case the file is present].
I don't want to preserve the full path, so I use -C /opt/server/nginx/etc/nginx
/tmp/backup/ folder is present.
Fails:
(venv) root#bhakta-at-host-1:/opt/server/agent# cd /root
(venv) root#bhakta-at-host-1:~# tar -cvzf /tmp/backup/NginxServer_cfg_save.tgz -C /opt/server/nginx/etc/nginx/ $(ls -d nginx.conf)
ls: cannot access 'nginx.conf': No such file or directory
tar: Cowardly refusing to create an empty archive
Try 'tar --help' or 'tar --usage' for more information.
(venv) root#bhakta-at-host-1:~#
(venv) root#bhakta-at-host-1:~#
Fails:
(venv) root#bhakta-at-host-1:/tmp# cd /var/tmp
(venv) root#bhakta-at-host-1:/var/tmp# tar -cvzf /tmp/backup/NginxServer_cfg_save.tgz -C /opt/server/nginx/etc/nginx/ $(ls -d nginx.conf)
ls: cannot access 'nginx.conf': No such file or directory
tar: Cowardly refusing to create an empty archive
Try 'tar --help' or 'tar --usage' for more information.
(venv) root#bhakta-at-host-1:/var/tmp#
Works:
(venv) root#bhakta-at-host-1:~# cd /tmp
(venv) root#bhakta-at-host-1:/tmp# tar -cvzf /tmp/backup/NginxServer_cfg_save.tgz -C /opt/server/nginx/etc/nginx/ $(ls -d nginx.conf)
nginx.conf
Works:
(venv) root#bhakta-at-host-1:/opt/server/nginx/etc/nginx# tar -cvzf /tmp/backup/NginxServer_cfg_save.tgz -C /opt/server/nginx/etc/nginx/ $(ls -d nginx.conf)
nginx.conf
(venv) root#bhakta-at-host-1:/opt/server/nginx/etc/nginx#
Works:
(venv) root#bhakta-at-host-1:/var/tmp# tar -cvzf /tmp/backup/NginxServer_cfg_save.tgz -C /opt/server/nginx/etc/nginx/ nginx.conf
nginx.conf
So what is going on here? It seems to be something to do with -C and $(ls )
Versions:
(venv) root#bhakta-at-host-1:/opt/server/nginx/etc/nginx# tar --version
tar (GNU tar) 1.29
Copyright (C) 2015 Free Software Foundation, Inc.
License GPLv3+: GNU GPL version 3 or later <http://gnu.org/licenses/gpl.html>.
This is free software: you are free to change and redistribute it.
There is NO WARRANTY, to the extent permitted by law.
Written by John Gilmore and Jay Fenlason.
(venv) root#bhakta-at-host-1:/opt/server/nginx/etc/nginx# lsb_release -a
No LSB modules are available.
Distributor ID: Ubuntu
Description: Ubuntu 18.04.1 LTS
Release: 18.04
Codename: bionic