@M Akhtar
I think this phenomenon is caused by the database being too large. The limitation for Exchange database is 1024G, the size of your database is already close to this value.
I would suggest you create multiple databases, and migrate a part of the mailboxes. Then, dismount the original database and use ESEUTIL tool to defragment the database files.
ESEUTIL /D
After that, mount this database and enable Circular Logging again.
About the CatalogData file, it is the index folder for Exchange database, they can be regenerated after being deleted. You could delete them to free up some space. Since your database is too large, it may take a long time to rebuild.
For a better performance, it is recommended that you control the database below 500G.
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