If some people has lots of bitcoin in their offline wallets and they die or lose memory.
Then those coins will be out of circulation right? Or is there any way to recover them?
That would be the obvious case here. If someone has some Bitcoins and forget or die, his funds will be lost forever, saying that he is the only one who has access to it. But if someone he knows his private key for his wallet, then that someone can get the funds and continue to use it and be included again in circulation. But there is no one can access the lost funds, it will be lost forever.