Dear Sudipta
The pay cut is something diffrent from deductions from salary and wages. The word pay cut arises when an organisation goes for lay-off. I do not think your question is directing for lay-off. If Pay cut has to be administered then the organisation has to obtain permission from the government or otherwise will be treated illegal.
There can be reduction in salary and wages if there is less attendance. Further, fines and penalty and deduction due for EPF,ESI & Advance as well as other deductions for which employee has given his consent. All these deduction is legal or illegal.