Cannot extend C: partition, "Extend Volume" grayed out

My disk Partition C is almost full so I am trying to increase it's size but Windows is not allowing me to do so in spite having 195GB unallocated space!

The unallocated space is in the wrong place. You may only extend a partition downwards, so this space must follow the partition of C.

You need to boot a partition editor, since you cannot move C while also booting from it. Then you will need to move E down to overwrite the unallocated space. This will move this space between D and E. Repeat this for D to have the unallocated space follow C.

You should then boot into Windows and resize C. It is best to resize Windows using Windows. The bootable partition editor might possibly make a mistake when handling sensitive Windows files.

This operation is dangerous, in the sense that a mistake can make the disk unbootable. It is best to take a backup image of the disk and have a bootable media of the backup program that can restore it in case of a severe problem (and to test it before starting).