Section 8. Employment of adults, hours of work. -No adult shall be employed or allowed to work about the business of an establishment for more than nine hours on any day or 48 hours in any week and the occupier shall fix the daily periods of work accordingly.
So you are fine there.
But retention of wages is wroong both in Shops Act and Payment of Wages Act
Legality of retention of half month's salary can be assessed depending how it is communicated to the employee. Suppose while issuing the appointment letter, it is mentioned that for the first month, the salary will be "X" and second month onward it will be "2X" then I do not think that it can be questioned. This is because terms and conditions of employment are specified in the appointment letter and employee accepted those. Therefore,grumbling at later stage is not worthwhile.
Going further, many employers communicate about retention of 50% salary at the time of recruitment itself and later they make this provision of deduction and disbursement after one year in the letter of appointment. Will any law prohibit doing this? As long as minimum wages are paid in the first month, everything is fine!
In addition to the above you may see in the commercial establishments are open from 9.00 AM to late hours PM. Ask any employee whether he is paid any kind of compensation for the period more than 8 hours. This is the exploitation of workers, which should be checked by the labour department, but many times you may see the officials of the labour department off time shopping.
Any retention and deduction as you have discribed is a violation of sec 6 and 7 of the payment of wages act. Most of the shop and establishment acts also provide similar rules. Whether communicated before or not, it is illegal. These laws are intended to prevent exploitation of workers who can't stand up to employers.
The only way this would be allowed is if the appointment letter had only the 50% of salary mentioned as the actual salary and provided for a retaintion bonus of 1 years salary on completion of a year of service.