Explored numerous options to resolve the problem. here are some option I have tried

1. added "type": "module" in package.json
2. clean cache, clear dependencies and reinstall everything

rm -rf .serverless/ .webpack/ node_modules package-loc.json npm install

3. debug using serverless print
4. finally worked! explicitly set .mjs in serverless.yml

Before serverless.yml

functions:
  myfunction:
    handler: handler.main

After serverless.yml

functions:
  myfunction:
    handler: handler.mjs.main

That means Serverless Framework wasn't automatically detecting .mjs files