Is It Fair for Companies to Deduct Gross Salary for Notice Pay? Let's Discuss Your Rights

I worked with a company for 15 months. As per the appointment letter, the notice period was 3 months. Since I gave only 1 month's notice, the company has deducted 2 months' gross salary. Is it not illegal to cut gross salary? The company has paid me only basic salary in lieu of PL encashment. Should not the company deduct only the basic salary for 2 months as notice pay? I understand allowances and perquisites are not counted as salary unless the person actually works and earns it. Hence, in case of PL encashment or notice pay cut, the salary means basic salary. Why does the company then consider gross salary in case of notice pay?

Notice Period and Salary Deductions

Please avoid using the company name. Read the appointment letter terms on notice period shortfall recovery to determine if it applies to the basic or gross salary. PL encashment is different from notice pay. Both cannot be correlated.

Regards,
Pon

The appointment letter states just "Salary" in lieu of a shortfall in the notice period. Normally, reputable companies deduct only the basic salary. I will remove the company name by editing the same. However, I thought that CiteHR also tries to convince the said company to adopt good HR practices. Anyway, I will remove the company name now.

Since it's mentioned only "Salary" in the offer letter, it refers to Gross salary. As far as I know, the Notice Pay recovery is based on Gross salary in many companies where I have worked.