I am logging this the yourselves and the plugin author.
With User Menus Plugin enabled (hidden link)
When creating an Access Control Post Group and connecting it to a custom post type that has been created.
When setting the user permissions if you use a content template to redirect the user with no permissions ... it doesn't restrict you from seeing the custom post type and doesn't show what you have on the content template.
[The idea eventually is for the content template to run a meta refresh to ask them to register or login]
This content template option does work however if you have selected a "standard" WordPress page... just not if its a custom post.
Here re some pics to help understand.
For now I have just setup custom 404 page that asks them to login...
Thank you for waiting and I apologize I couldn't follow up on this sooner.
Here is the feedback I've received from the concerned team.
The way Access Post Group restrictions work, it is expected that if you want Toolset to be able to influence the template used for posts, then Toolset templates and not Elementor templates, should be used.
If the use of the Elementor template can't be avoided, then the workaround that you're already using of showing the 404 page to the users without the read permission, should work just fine.