Hi PaQ, that's a pretty weird one. It seems to refuse to intersect those 2 cylinders.

For the moment to finish your model, if you go to the Front view and stretch out your cutting cylinder to be quite a lot taller in size, like this:



After a certain size it will start to work, so you can do that for the moment to finish this model. I'll dig into it to try and track down the bug.

- Michael