Australia and India called a truce to their week-long feud when rival captains Ricky Ponting and Anil Kumble met on Monday and the visitors dropped a complaint against spinner Brad Hogg.
Ponting and Kumble emerged from the one-hour meeting at a Perth hotel saying they had resolved their differences.
"We're really happy with the outcome," Australia skipper Ponting told reporters. "We've decided from here on in this (four-match) series will be played in great spirit.
"The first Test certainly was and it's our responsibility to make sure we uphold that and we're looking forward to the next couple of Test matches being very good and very enjoyable for the spectators."
Kumble said the teams wanted to put the feud behind them.
"It's time to move on and whatever has happened, it's just one of those incidents," he said. "Ricky and I had a fantastic meeting...and we're really happy to be playing cricket again."
India also said they had withdrawn a complaint against Hogg.
The Australian was charged with using abusive language during last week's bad-tempered second test in Sydney but the case was dropped when the visitors withdrew the complaint.
"It's all behind us now so we can get on with cricket," International Cricket Council (ICC) match referee Mike Procter said. "It's a wonderful gesture by India, showing what sportsmanship they possess."
Ponting and Kumble were all smiles as they shook hands and posed for the cameras after the meeting and ICC mediator Ranjan Madugalle said he was satisfied there would be no repeat of the bitter fallout in Sydney.
Madugalle was called in to help resolve the dispute after Kumble questioned Australia's sportsmanship during the second test and the Indian cricket board (BCCI) threatened to quit the tour unless the ICC cleared Harbhajan Singh of a racism charge.
Harbhajan was suspended for three matches after the ICC found him guilty of calling Australia all-rounder Andrew Symonds a monkey.
Off-spinner Harbhajan has denied the claims and lodged an appeal. In the meantime he can play on while the BCCI has also withdrawn its threat to abandon the rest of the tour.
The Australians, heavily criticised for their on-field conduct in Sydney, have vowed to stick with their traditional win-at-all-costs approach for the third test in Perth starting on Wednesday despite conceding some of their behaviour was boorish.
"Both captains have agreed it's their responsibility to move the game forward and the events of the last week are something they'd like to forget," Madugalle said.
"As leaders they need to ensure the team plays the game in its correct spirit and importantly, with respect for one another.
"Hopefully over the next five days (they) ensure cricket is the winner through the skills of their collective performances as opposed to anything else."
India coach Gary Kirsten said it was important the players were instrumental in resolving their differences because they had responsibility to lead by example.
"We're not trying to stop the flair, we're not trying to stop the entertainment, but when it goes to the level it appears it has gone to last week, you have to draw the line," he said.
"The players are the custodians of the game. They have to stand up and say, 'this is the way we're going to go about our business'."
Australia lead the series 2-0.
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