No email notifications are being sent on custom workflow transitions
When a custom workflow is being used, no email notifications are generated by JIRA when custom workflow transitions are executed. JIRA outgoing messages log does not contain any entries for attempts to send those email notifications out.
Email notifications are triggered by the events subsystem, which is configured in the post functions for each individual workflow transition, usually at the last step. Events in JIRA can be of several types, which govern what kind of email template will be sent out if any.
Custom workflows by default have a "Generic Event" configured in workflow transitions. Generic Events do not send out email notifications. They need to be swapped for the corresponding event type that will send out email notifications.
Change the event type in your workflow configured in accordance with the intended workflow transition, e.g. use "Issue Updated" event type for intermediary workflow transitions to send out email notifications to users and groups configured for "Issue Updated" event in the project's notification scheme.