Can you provide a full show run and show version - remove the sensitive information etc.
I have just tested on my 857 and the proposed solution works fine.
line vty 0 3
access-class ALLOWED_MGMT in
login local
transport input ssh
line vty 4
access-class ALLOWED_MGMT in
login local
rotary 1
transport input telnet
telnet to port 3001 brings you in on vty 4
Line User Host(s) Idle Location
2 vty 0 GJH idle 00:00:26 192.X.X.X
* 6 vty 4 GJH idle 00:00:00 192..X.X.X
I'm running c850-advsecurityk9-mz.124-15.T7.bin
so a slightly later version than you.
So this is either
IOS version
Router Model
or something else in your configuration.