If we're talking about the timeout option which the end user can set in its own application, then I'm not sure I'd classify this as a bug?

Some systems set a timeout because they have to provide a reply within some t. After t they have to return with a failure and it's not really relevant what happened: the point is that it could not be performed in that time limit.

Often in such cases it's also useful to cancel any further pending work to save resources from being utilized for a task which is no longer being requested.