Why can you not add herbs and spices powder at end? As far as I'm aware any herb or spice CAN be eaten raw and hence added at the end of cooking.

We cooked a stew with garam masala as we wanted to try something bland.  It wasnt very tasteful so I suggested adding the chill powder in hours after the garam masala stew had been cooked.

My friend told me it was too late and the curry would start to smell bad if we added it now.

This question is not about whether adding at the beginning or the end would add more flavour as I know certain herbs need to be cooked to extract flavour.

Rather why did she say the curry would smell and isn't this statement contrary to the idea that you can add any spice at the end of cooking?
That's absurd, imho.  You add spices generally to the earlier stages of a stew so they can meld in together, between themselves and with the main ingredients.  That takes time usually, more time than just cooking even.  It's why most stews are better the next day, when flavors have really had the opportunity to form a cohesive whole.

So if you add spices at the end, you run the risk of them not being totally well mixed.  But there's no way your curry would start to smell bad!  Especially from chili, which if anything would prevent any bad smell from its conservation powers. That's just superstition.  And I hope you added some and demonstrated that :-).  Or at least try it on your leftovers.