I think the topic is too easy to implement for one year as a final project.

The important thing of such an online code testing system is collecting good problems and test cases for verification.

Implementation of the system itself is quite obvious and easy, and doesn't even take much time. Any senior year students with some programming skills can implement such a system within a month, then will take much more time to fill in problems in the system. So it's more of a labor-intensive topic rather than skill-required topic.