Why does opening a .doc file that contains checkbox character, the checkbox is being replaced with bullet character?

The original .doc document was probably made in Microsoft Office.
However, after opening the .doc document with libreOffice (Version: 6.3.4.2),
I see Bullet characters instead of checkbox characters.

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Why this is happening and should I report this as a bug?

You’re stumbling on a recurrent compatibility issue.

A .doc file follows Microsoft document format (which is not public and has been approximately retro-engineered). When you open such a file, an input filter tries to convert the primitives into the ODF standard on which Writer is based.

One of the main differences between both format is the lack of many style categories in Word, notably character, page and list styles. Consequently, the input filter tries to correlate many elementary formatting instructions to synthesise an ODF primitive.

List item bullet is known to be one of the problematic translation issues (have you seen what happens to Powerpoint slides with bullets when translated to Impress?).

The problem can’t be solved if you keep saving the document as .doc. You can change the bullet character to fit your taste, but if you intent to recover it on next open, save your document as .odt otherwise you’ll incur yet another couple of translations (one when saving, one when opening).

This can be considered as a bug, but since the Microsoft format is not public (and ever changing), one can never ascertain that translation into ODF is accurate.

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In case you need clarification, edit your question (not an answer) or comment the relevant answer.

Doc format is listed under Formerly proprietary. And says that it is now under Microsoft Open Specification Promise

A complete specification of .doc format.