What happens to Dash wallet if PC is formatted? I am new to cryptocurrency. Let's say I setup a DASH wallet using this link https://www.dash.org/wallet/ on my Windows PC.

I encrypt my wallet using passphrase now after 1 year my PC's hard disk has corrupted. What happens to my DASH coins?

Would I loose them forever or can I recover them using the passphrase I entered while setting it up?
I haven't used Dash, but they say it's based on Bitcoin-QT (from Bitcoin Core).  Assuming they operate similarly, then in order to recover coins, you need both your wallet.dat file and your passphrase.  If you don't have them both, your coins would be lost.  So you should keep secure and reliable backups.

Some wallet clients can give you a "mnemonic phrase" (not the same as a passphrase) which can be used all by itself to recover your coins.  However, Bitcoin Core is not one of them, so I assume Dash doesn't support this either.