Switch function not working

anacpint , this is my suggestion:

Create a new Calculated Table called dimClassification:

dimClassification = VALUES('factRFTC'[Classification])

Add a relationship between the dimClassification table and factRFTC table. Make sure the relationship is Many to One, and the direction flows from the dimClassification table to the FactRFTC table.

The measure that you use for the conditional formatting in the matrix should be changed to this:

ColorSwitchRFT = 
    VAR vClassification = SELECTEDVALUE('dimClassification'[Classification])
    RETURN
        SWITCH(
            TRUE(),
            vClassification = "Correct", "#11A82B",
            vClassification = "Low","#A9CC0D",
            vClassification = "Moderate","#F2CB49",
            vClassification = "New_Requirement", "#12ABDB",
            vClassification = "Severe","#FF6961"
        )

Then delete the Fact_RFTC[rft_classification] field from the Rows field from the matrix, and add dimClassification[Classification] in its place.

Set the Conditional Formatting of the RFTC_NoBlank field in the matrix for Background Color to be Format Style "Field Value", and set the "What field should we base this on" to your [RFTC_NoBlank] measure.

When I do that with some test data, this is what I get. Note that my test data in FactRFTC has no rows at all for month March 2021, but the cell for {Mar-21, Low} is correctly coloured green because it gets the value for Classification from dimClassification.

Hope this helps.