By mistake asked the wrong behavior,
Firmware could not work with 16-bit UUID and gets hanged.
Works fine with 128-bit UUID .
Please attach the project.
16 bit UUIDs are Bluetooth standard ID declarations, and as such are meant for certified/standardized services/profiles. Cypress tries to help with this by assigning custom profiles/services to 128-bit UUIDs automatically. If you are trying to use a 16-bit UUID, chances are that the phone is recognizing the 16-bit UUID for the service/profile that it is designated as (say medical location or something like that), rather than allowing you to use it as a "custom" service.
Unless you follow the specifications of the 16-bit UUIDs that you use according to this:Service Discovery | Bluetooth Technology Website
then most likely you will run into compatibility issues when trying to use your profile with standard Bluetooth devices/phones.
I would suggest sticking with the UUID 128-bit for your custom service unless you are specifically trying to use one of the standard/declared services on the Bluetooth website.
tl;dr; Use the 128-bit UUID