Composer creates new files instead of diff'ing existing files if files are not in the project's root folder

I’ve not experienced this before, might be due to some regression but I passed my current files to Composer, some of which are not in the root folder. Composer then suggested some changes and applying them created a new file in root folder instead of merging the suggestions onto the existing file on some subfolder.

Version: 0.42.2
M1 Max
Sonoma 14.6.1 (23G93)

happened to me too today, it kept creating a new file in root/components/
where it applied just the new code, so that the file did not even make sense.
It also created the root/components/ folder.

I’m getting this too. Quite annoying

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