to install an old orthography Malayalam Unicode font which is required to read the posts below]
For Sanskrit words used Malayalam, ത is pronounced as it is, only when a vowel or semi-vowel comes after it. For all other occasions, it is pronounced as ല.
An example would be ഉത്സവം. Eventhough, its Sanskrit originated form is ഉത്സവം, it is pronounced in Malayalam as ഉല്സവം.
This means, chillu form of ത should be pronouced as if it is chillu form of ല. Thus ല് is in a very curious situation:
: Graphically it is chillu of ത.
: It can represent either of the characters - ത or ല.
: Its pronounciation is the chillu of ല.
Reference: കേരളപാണിനീയം, പീഠിക - A. R. Raja Raja Varma