You have accepted the practice of the company. You were also not provided with any offer of appointment with full description of terms and conditions, I think. It must be a proprietor type of company and must be dealing with number two business activities of selling the products and services without invoice or on fictitious under valued invoices. This is a normal practice in schools and hospitals and such like institutions where people know it and still opt for service as per the demand and supply of man power situation. But people here do not stick for long, they shift to other places when so ever there is a availability. I think you must have also felt the same thing.
As long as you get the salary as per your contract, orally of course, half in number one (Cheque) and other half in number two(cash), you may not bother as you would save the income tax your self also on the amount given to you in cash form. But the risk always stands in your way. One day or the other, the company would be in trouble due to number two business which would be raided and then you may also have to face the music. So it is better to shift some where else. It is my way of thinking.
3rd July 2013 From India, New Delhi