To fix this, we need to install required IIS features to execute the SSINC-shtm handler. Please follow below steps to install required IIS features.
Login to server (VPS) and go to Control Panel → Programs → Programs and Features → Turn Windows features on or off.
Select Internet Information Services → World Wide Web Services → Application Development Features.
Make sure you have checked the check boxes of features: .NET Extensibility, ASP, ASP.NET, ISAPI Extensions, ISAPI Filters, Server-Side Includes.
Then in IIS under Handler Mappings, make sure you have SSINC-shtm for path *.shtm, and SSINC-shtml for path *.shtml enabled for the ServerSideIncludeModule Handler, path type File.