Dear Saswata,
Your curiosity is quite genuine, logical and infact a legally valid one too.
Apart from the mandatory requirement u/s 4-A of the PGA,1972 which is yet to be given effect to enforcement by means notification by many State Governments, an insurance policy taken with the LIC in this regard covers the liability of the employer to pay gratuity under the Act when the occasion arises.
As you are well aware, the premium is calculated and collected on actuarial basis only based on the average salary payable to the employee during the preceding 12 months. As such, there is reason to believe that the short fall in the last drawn salary for whatever lawful reason would get automatically adjusted by the value of the actual maturity amount of the policy.
Even otherwise for the reason of salary cut during the last spell of the service of the employee like the one mentioned in the original post, if the Insurer is prepared to pay a lesser amount than the statutory amount of gratuity based on any lower rate of premium, still the employer is liable to make good the loss.