Gratuity dispute

Please contact a local advocate who is an expert in such labor matters after studying the eligibility of such gratuity in proprietorship concern, he may suggest you as to whether the previous employer is liable to pay such Fratuity, based on other evidence..  But raising the issue after 25+ years is a disadvantage, as the employment conditions while taking up a job in a private company is important.

Arrange to give a legal notice through a lawyer for gratuity claim. If you have been denied gratuity payment by your employer, you can file a complaint under Section 8 of the act, against the company. The controlling authority, on hearing both sides, if satisfied with the employee's stance, can direct the employer to pay the gratuity that is due along with the interest on it.

Is it the case that uncle has recived the gratuity for the period from 1996?

Yes,

My uncle not received any gratuity, & as mentioned in my query the earlier proprietor is now a Director in Private Limited, the name was shifted on Private Limited Payroll without paying any gratuity amount of earlier period

Provisions of section 3 of the Payment of Gratuity Act, 1972 provide:

(3) It shall apply to -

(a) every factory, mine, oilfield, plantation, port and railway company;

(b) every shop or establishment within the meaning of any law for the time being in force in relation to shops and establishments in a State, in which ten or more persons are employed, or were employed, on any day of the preceding twelve months;

(c) such other establishments or class of establishments, in which ten or more employees are employed, or were employed, or, any day of the preceding twelve months, as the Central Government may, by notification, specify in this behalf.

(3A) A shop or establishment to which this Act has become applicable shall continue to be governed by this Act notwithstanding that the number of persons employed therein at any time after it has become so applicable falls below ten]

Accordingly your uncle is not covered for gratuity.