I would agree that is very clear that the claim and your defence have both been struck out and accordingly, the first port of call if you have not already done so would be to contact the clerks of the court to ask them to explain how in view of the letter you have kindly uploaded above, the claim is proceeding as it is quite clear from the correspondence that both the claim and defence were both struck out.
The explanation may be that the claimant made an application to restore the claim but if so, but application presumably was not served upon you nor did the court send you any correspondence regarding that application. Whilst it is possible to believe that one or possibly even two items of correspondence were lost in the post, it stretches credulity that every piece of correspondence relating to that application somehow was lost in the post.
You may or may not be able to obtain a satisfactory answer. If a hearing is taking place tomorrow, despite the above, it would be very wise to attend in whatever capacity you are able. I imagine, if you are able to attend, it is likely that you will not have a defence fully prepared that you may have a defence prepared which you had begun work on. At the hearing, you would want to bring the letter you have uploaded to the attention of the judge and say that as a consequence of the same, you have not had the opportunity to prepare a defence only believe in view of the letter, unless there are circumstances of which you were not aware such as that described above, the hearing is being held in breach of the civil procedure rules and you would like to ask the judge in the circumstances either to confirm that the original strike out bands or if not, how it has come to be reversed and if it is the position of the court that the claim is to proceed, then to grant an adjournment to enable you to properly prepare a defence in view of the procedural irregularities. If the judge refuses, you can highlight politely there would be an extreme risk of an appeal on your part in the event the claim is decided against you