Email forwards to a forwarder on same cPanel's account, will it work?

Hi, we are setting up this email structure as follow:

Code:

contact@company.com
    => 01@company.com
        => his@hotmail.com
        => his@gmail.com
    => 02@company.com
        => her@hotmail.com
        => her@gmail.com
    => ...

After performing tests, we get this error..

Code:

This message was created automatically by mail delivery software.

A message that you sent could not be delivered to one or more of its recipients. This is a permanent error. The following address(es) failed:

  his@gmail.com
    (ultimately generated from 01@company.com)
    retry timeout exceeded

We find it funny that the emails could be sent to either Gmail or Hotmail directly with Outlook
But it will create an error if it is being forwarded twice

Example:
An email sent from Outlook original@company.com to contact@company.com
contact@company.com forwards to 01@company.com
01@company.com forwards to his@gmail.com


If I recall correctly, It'd be fine if the forwarder redirect the email only once

Please advise if this is a bug or it shouldn't be done this way in the first place
All settings are done in the WebMail > [Forwarding Options] interface

Thank you