I have whitelist the IP address of the server 1, however sometimes i see that i get a HTTP timeout error. I know that this mainly has to do with server configuration, however is there any chace this issue is related to Cloudflare? Can i increase the HTTP timeout time somehow?
If you exceed 100 seconds the issue is semi-related to Cloudflare as Cloudflare will close the connection after that period. No, you cant change that unless you upgrade to an Enterprise plan.
In your case it probably is best to go around Cloudflare by either directly using the IP address or using a non-proxied DNS record.