I don’t think this has ever worked in any version of Rhino.
This is easy to do using the Trim command.
First, extract the outer surface (use extractsrf command) of the cup and then select
the handle and the outer surface then run Trim. Click on all the parts of each surface you want trimmed away. When done trimming click on the join button. In this file I hid the inner parts of the cup after trimming and joining the outer parts unhide the rest of the cup and join into a solid Cupx.3dm (105.0 KB)
.