Chasing a daunting target of 352, Railways were bowled out for 344.
This was Kerala's second victory on the trot in Elite Group C.
Kerala were 233/4 in 38.2 overs when rain ended play and were declared winners by VJD method against Odisha in Elite Group C.
It was Kerala's third win on the trot in Elite Group E, while Delhi suffered their first loss in three games.
The incident happened right after Uthappa dropped a Sunil Narine skier in the fifth ball of the third over.
The hosts, who were reeling at 89/6 at one stage, were bowled out for 227 shortly after the tea break. Punjab were 46/2 at stumps.
The Kerala one-day and T20 captain picked his team for Malayala Manorama daily.
Robin Uthappa, who was released by Kolkata Knight Riders last month, is the sole Indian player with a base price of Rs 1.5 crore in the auction list.
The Kerala Ranji captain says his side is placed in a tough group and it's important to take it one game at a time.
Veteran middle order batsman Rohan Prem has been included in the squad subject to fitness. Young batsman Rohan Kunnumal and leggie S Midhun are the new faces in the squad.