finally i was able to determine the root cause of the problem, it was due to the user corrupted mbox, the solution was to delete the 1st two lines of the /var/mail/username file, restarted dovecot and whoala, i can now telnet successfully.
This is a well-known bug in the 0.99 series... It is still highly recommended that you upgrade to 1.0.0 if possible... -- Best regards, Charles
