Hello SanskarSuman,
I'm John an Independent Advisor and a Windows like you. I'll be happy to assist you today. When was the last time it worked properly? What is your current Windows version and edition? Press Start then click Settings(Gear icon), select System then About.
Kindly try the method below.
**Click Start then search Registry Editor
Navigate to the following path
HKEY_CLASSES_ROOT\Folder
In the right-pane, double-click (default) and set its data to Folder
Exit the Registry Editor.
Restart your computer
If this does not work, Please download and run again the Restore_New_Folder_context_menu_item.reg, which reset the restored context menu item to create folders.
**Please try creating a new local administrator account then check if the issue still persists.
https://support.microsoft.com/en-us/windows/cre...
Kindly let me know if this helps or if you have any further concerns.
Kind regards,
John DeV
Independent Advisor