We have Microsoft 365 mail setup with a connector for a third party SMTP server (postfix) which sends email from @ourdomain.com.au to @ourdomain.com.au and @externaldomains.com.
SPF, DKIM and DMARC are all set to allow mail from M365 and the third party server.
Email from the third party server to external domains is working fine and I can see mail (via message trace) going through our M365 servers.
Email sent to our M365 accounts however, is dropped completely, that is no trace results and no NDRs sent back to the third party server.
If I try sending a simple email from the third party server, via telnet commands, the emails are delivered to our internal accounts. This is making it super hard to troubleshoot
I found the following comment here and suspect this is related but not sure where to start looking.
This depends on the connector settings of the Office 365 tenant you are sending messages to. Office 365 allows mail admins to route messages with certain criteria to an internal SMTP service or a smart host. For those messages, Office 365 may think they have been routed to another server successfully. Actually the messages might be lost by a smart host, or the smart host doesn't support to return NDR. You can try to trace the email in Office 365 to find the routing path. Meanwhile, check the connectors, transport rules configured in the corresponding Exchange Online admin center.
Thanks in advance!