Cypress on uncaught exception is not working

I have the following sample script to experiment exception handling in Cypress. But the exception is not being caught. What am I missing here?

Cypress.on('uncaught:exception', (err, runnable) => {
    Cypress.log("this is top-level exception hadling")
    return false
})

context('Actions', () => {
    
    it('sample_testing', () => {
    
        cy.on('uncaught:exception', (err, runnable) => {
            cy.log("this is test-level exception hadling")
            return false
        })
        
        cy.get("#notfound", {timeout:1000})
    })
    
})

Please note that there is no element with id notfound in my web page.

Uncaught exceptions are only for application errors. Failures within the test code are caught by Cypress but are then reported as a test fail.

Test Fails

To prevent that, you can use the fail event

Cypress.on('fail', (error, runnable) => {
  debugger

  // we now have access to the err instance
  // and the mocha runnable this failed on

  throw error // throw error to have test still fail
})

it('calls the "fail" callback when this test fails', () => {
  // when this cy.get() fails the callback
  // is invoked with the error
  cy.get('element-that-does-not-exist')
})

Uncaught exceptions

Take a look at the recipe Handling Application Errors

app.js - throws an error

document.getElementById('error').addEventListener('click', () => {
  console.log('application will throw an error in 1 second')
  setTimeout(() => {
    console.log('application is about to throw an error')
    throw new Error('Things went bad')
  }, 1000)
})

test - catch the error and selectively ignore if it has a certain message

  it('can be ignored', () => {
    /**
     * By using "cy.on()" we can ignore an exception in the current test only.
     * If you want to register exception handler for all tests using "Cypress.on()"
     * @see https://on.cypress.io/catalog-of-events
     * @param {Error} e The exception we caught
     * @param {Mocha.Runnable} runnable is the current test or hook during which the error is caught
     */
    cy.on('uncaught:exception', (e, runnable) => {
      console.log('error', e)
      console.log('runnable', runnable)

      // we can simply return false to avoid failing the test on uncaught error
      // return false
      // but a better strategy is to make sure the error is expected
      if (e.message.includes('Things went bad')) {
        // we expected this error, so let's ignore it
        // and let the test continue
        return false
      }
      // on any other error message the test fails
    })

    cy.visit('index.html')
    cy.get('button#error').click()
    // the error happens after 1000ms
    // we can use hard-coded wait, see the other test
    // to learn how to avoid an unnecessary wait
    cy.wait(1500)
  })