The visitors resumed at 128-5 after surrendering under the lights in the final session on Saturday and had a horror start.
Dangerman Rishabh Pant failed to survive the first over, edging Mitchell Starc to Steve Smith without adding to his overnight 28.
Pat Cummins accounted for Ravichandran Ashwin (7), who gloved a bouncer to wicketkeeper Alex Carey, then Harshit Rana (0) with another bumper that popped up to Usman Khawaja at gully.
Allrounder Nitish Kumar Reddy made a plucky 42 before he fell to Scott Boland, caught by Nathan McSweeney in the deep, and when Boland removed Mohammed Siraj (7) it was all over.
Cummins ended with 5-57 while Boland grabbed 3-51.
Australia dismissed India for 180 in the first innings thanks to a six-wicket blitz from Starc.
Travis Head then clobbered a whirlwind 140 to help the hosts to 337 and a 157-run lead before they decimated India's top order on day two.
India won the first Test in Perth by 295 runs.
