Welcome to LQ ssanwar80,
Why are you prefering telnet to ssh ? Telnet doesn't support encryption. It simply send sensitive informations like username and passowrds in plain text.
I advise you to go for ssh instead of telnet. You can adjust following parameters accordingly in /etc/ssh/sshd_config file to get your things done.
Still if you have strong instinct to use telnet. You can append following -IdleTimeout option to server_args in /etc/xinetd.d/telnet file
server_args = -IdleTimeout 600
By default, 600 will be in seconds.
Hope this helps.