Lifting and holding your cat by the scruff of their neck is unnecessarily stressful. It can be extremely painful for your cat. When cats are at a very young age, the mother cat will carry them like this, by biting the scruff of their neck. At this age, they have a reflex that makes their bodies go limp.
They may still do this as a new kitten, but when they are older they grow out of this. If they are scruffed as an adult cat they tense up and it can be distressing and painful for them.