Umakant Mishra was suspended from his job after being charged with fraud when 57 rupees and 60 paise (92 cents; 56 pence) went missing in his post office.
Mr Mishra told BBC Hindi that  the battle to clear his name reduced him to penury and his family would have starved if not for his relatives.
He is now seeking compensation.
Correspondents say cases in Indian courts can drag on for years, even decades, and official figures show that more than 30 million cases are pending in Indian courts, some dating from 1950.
Mr Mishra's troubles began on 23 July 1984 when he worked in a post-office in the Harjinder Nagar area of Kanpur city in the northern state of Uttar Pradesh.
"I was given 697 rupees and 60 paise ($11.19; Â£6.83) which the post-office had received as money orders and I had to distribute it. I distributed 300 rupees and in the evening deposited the rest with a senior official," Mr Mishra says.
When the refund was checked, it was found to be short by 57 rupees and 60 paise (92 cents; 56 pence).
"I was charged with fraud. I was suspended from my services and a complaint was lodged with the police."
Mr Mishra was jailed briefly and although he was freed on bail shortly afterwards, his long legal battle had started.
"I was summoned 348 times by the court. Initially I had to sell my house in Kanpur, then I had to sell my agricultural land in Hardoi district. I went bankrupt."
He did various odd jobs to support his family and fight the legal battle and says he was helped by his relatives who "helped me and provided me with shelter".
He was absolved of all charges last week after the prosecution could not produce any witnesses in the case.
"I was suspended when I was in my 30s. Now that I have been absolved, I should be compensated. I should get all the money that is due to me," he says.
An Indian postal worker who was accused of stealing less than $1 in 1984, has been cleared by a court after nearly 350 court hearings over 29 years.