I wanted to know if the (auto_update_plugin) and the (auto_update_theme) filters work when put in theme's functions.php file instead of config.php file in WordPress core.
In general they should. All of config load, plugins load, and theme load happens during load process and before
init hook, which is considered a point after which load is done and functionality starts.
Unless you are dealing with early load-related events, typically plugin is perfectly appropriate place.
PS not sure what you mean by
config.php, hooks don't even work as early as