Australia continued to chip away at the wickets to take complete control on Day 3 at MCG on Saturday.
India were struggling on 224/7 in 73 overs at lunch on the third day, having lost Rishabh Pant and Ravindra Jadeja in the morning session.
Pant gave his wicket away attempting a reckless scoop shot, to be caught at thirdman off Scott Boland for 28.
Ravindra Jadeja was dismissed leg before wicket by Nathan Lyon for 17 as India lose two wickets, while scoring 80 runs in 27 overs in the first session.
Nitish Reddy kept India afloat as he stroked an unbeaten 40 from 61 balls, with three fours and a six, while Washington Sundar was not out on five.
They still trail Australia by 230 runs.
Boland picked 3/37 in 17 overs, while Cummins claimed 2/70 and Lyon bagged 1/50 to keep Australia on course for a huge lead.