Where is the source that the cup we dip our finger into during the seder and extract several drops of wine is known as the kos shel paraniut (cup of punishment)? I recall this concept being referred to many years ago in yeshiva but have never come across it again. I just wanted to know if it is kabbalistic or halachic and what it really signifies or symbolizes. Thanks
The Lubavitcher Rebbe brings in his Hagada what appears to be primary sources for the concept of tying it to the second cup (and not as you might think, just because it is the second cup, making a pair - see Rashi Brochos there which implies that the pairs is an example).
In quick summary, there is a custom to pour out the cup and wash it in order to be sure that it is no longer a kos shel paraniut (a cup of punishment), especially considering the opinion that the 16 pourings correspond to the angel of revenge (G-d's sword). On the page at the link are all of the sources involved.
So the idea is that the fact that the taking out of the wine represent Hashem's punishment, makes this a cup of punishment - note that the point there in the Chabad Haggada is to avoid this problem by having different intentions. However, I was once at a seder with sefardim, and they very much made the cup into the thing representing the punishment - I don't recall exactly how, but I remember getting that strong impression and noting the contrast. I don't remember if they emptied and washed out the cup. Then again, sefardim don't say a brocha directly on the second cup, just the גאל ישראל over it.