I think RockRose is correct. Your son reminds me of our nephew when he was a child. Later when he was a young adult, he was diagnosed with high-functioning autism. This is not to say that your son is autistic - but, you really do need to get proper advice from a specialist - start with your son's doctor. By the way, the earlier the help for children re autism (or any neurological disorder); the better the prognosis. All the best ...
He is not able to make proper sentences, neither in English nor in our mother tongue. He gets confused in how to put his thoughts into words during conversations. Thinking and writing is little better. But for his 1st standard competitions, he has baged lots of prizes. (He prepares a day before and go).
I think you should have him tested. It sounds like he has a language processing disorder of some kind.
I'd ask for a referral from his pediatrician to someone who can do speech and hearing and language processing testing.
It sounds like he's very bright, and might be slightly brushed with autism, based on his interactions with his friends as "instructor" rather than peer.
Sounds like he's got a lot of positives -
With family, If the topic is of his interest, he will listen and understand and will questions about his confusions. But with friends, he try to behave like a grown up and give them instructions. And often (in fact always) cannot tell the conversation that happened earlier. He never tells about his friends talk because he can't remember them.
He just hear our phrases, but don't listen to them.
Do you notice that with other things like in conversation?