I figured out what was causing the problem.

It had to do with the RELEVANSSI plugin. In the ‘Searching’ tab, under the ‘Category exclusion’ section, I had the category that was not showing up, checked. Once I unchecked it, everything was working fine.

Sorry for taking up your time. Next time when I am dealing with any issue, I will deactivate all external plugins first to do some proper testing.

Thanks for all your help with this.