As an employer you are not bound to pay gratuity to employees who served less than the qualifying period of 5 years. The employees can not claim the amount also.
If you have provided as sum every year with a view to finding funds available for payment of gratuity, by any means including investment in mutual funds as are available now a days, the same could be regarded as an appropriation of Profit (with a debit to Profit & Loss Account) If the same is not utilised, naturally, it will remain as your fund with all attributes of undistributed profit. It will not lapse but will be an investment only.
Regards,
Madhu.T.K