404 page doesn’t show up

I am facing a very strange problem.
I am creating a theme for myself.

When using the default theme, the theme’s 404.php page works perfectly. But when I put a 404.php file in the new theme folder, it does not work.

Also in the index.php, outside the ‘if (have_posts())’ loop, in the else part, I have a small code that says ‘Not Found’. Now if I remove 404.php from my theme folder, I get the ‘Not Found’ message. But when I write the 404.php file, it doesn’t show (shows the normal the webpage cannot be found page)

I tried searching for the problem but couldn’t find anything. Please help me out. Thank you.

-Angad Sodhi