PT Connection on Relay is Removed

That's a very sophisticated relay that performs multiple protective functions. What was the system operator's reaction when you tripped the unit because you unwittingly removed one of the sensing inputs?

It has been used for grid islanding purpose but it did not operate for one of grid disturbance condition. And to confirm whether it is actually working or not one input was removed and surprisingly relay did not respond (not even the alarm indication). I just want to know whether it should react in some manner or not?

You'll find that information in the fine manual that came with the relay.

You will have to look in the manual and likely try and get an understanding of how it fundamentally works as I doubt there will be a specific paragraph on what happens if you remove the PT signal.

What was the grid disturbance condition anyway that you thought removing the PT signal would simulate the same event again?

Is either the datasheet or the manufacturer's telephone number to hand?

Your relay may not be set up for the purpose you mention...you need to check with the control specialist that commissioned the relay to see how it is set up...pulling wire connections off and on will tell you nothing...this is a complicated and sophisticated device that requires training and expertise to set up for your purpose....

http://gridautomation.pl/dane/Dokumentacja%20PDF/1.Zabezpieczenia/MiCOM/P34x/EN/MiCOM%20Alstom%20P341%20Technical%20Data%20Sheet%20GB.pdf