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Discrepancy between dev 1 & dev 2 region on workflow execution

Hi Team,

There is an email-to-case scenario where the case is created with Status of "New".
When the status is modified to In-progress there is an email communication sent through a workflow trigger.
Again when status is changed from In-progress to Escalated, another email is supposed to be sent through workflow trigger.

In dev 1 on changing the status from In-progress to Escalated, email is sent as expected, but in dev 2 on changing the status from In-progress to Escalated I am getting a pop-up box saying "You don't have permission to do this".
Strangely, even though I get the lack of permission popup, workflow gets triggered and email is sent successfully.

I am not sure what the issue is. Debug logs do not show any error information.

Any constructive suggestions much appreciated!
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Please note that all workflow rules, user set up, permission set and roles were identical in dev 1 and dev 2 when I last checked.