Melbourne: Steve Smith stood down as Australia captain on Sunday and was suspended for one Test by the International Cricket Council after owning his role in a ball-tampering scandal that has plunged his team into crisis and prompted the Prime Minister to seek "decisive action".

Smith was also fined 100 per cent of his match fee. Opening batsman Cameron Bancroft, caught on camera rubbing a yellow object against the ball during Saturday's play in the third Test against South Africa, has been handed three demerit points and a 75 per cent fine of his match fee.

Bancroft, however, escaped a ban and is free to play the fourth Test starting in Johannesburg on Friday. Another demerit point within a year can lead to him being suspended for one Test or two ODIs.

David Warner has resigned as vice-captain. Cricket Australia, the national governing body, said Smith and Warner had agreed to stand down following "discussions" with its officials.

Wicketkeeper Tim Paine took over the reins for the remainder of the third Test in Cape Town, which South Africa won by 322 runs, and will most likely be captain for the fourth Test.

Web portal ESPNCricinfo reported that the Australian government had earlier asked Cricket Australia to remove Smith as captain.

Prime Minister Malcolm Turnbull called it a "shocking disappointment" that the "Australian cricket team had been involved in cheating" and asked Cricket Australia to take "decisive action".

"The whole nation holds those who wear the 'baggy green' (Australian Test cap) up on a pedestal about as high as you can get in Australia, certainly higher than any politician that's for sure; (so) this is a shocking disappointment," Turnbull said.

Smith had admitted on Saturday that the ball-tampering carried out by Bancroft had been orchestrated by himself and senior players.

But although he was "embarrassed" by the scandal, he said, he had no intention of stepping down as captain.

The scandal - dubbed "sandpaper-gate" by some - has come at a huge cost to the reputation of the Australian team, whose recent claim about never "crossing the line" like others is facing ridicule from former players and fans worldwide.

The touring team had already drawn charges of "hypocrisy" and a "double standard" after complaining about "sledging" by the opposition and spectator abuse earlier in the series.

Former players from other countries have lined up to say that crowd behaviour in Australia, or sledging by Australian cricketers, is far worse.

Australian newspapers have described the scandal as the worst captaincy crisis since 1981 when then skipper Greg Chappell had instructed younger brother Trevor to bowl underarm with New Zealand needing a six off the last ball to win an ODI.

Former Australian players have condemned the tampering. Michael Clarke, Smith's predecessor as captain, said the revelations were "disgraceful" and that he had no doubt that the skipper would be "crying in his hotel room".

IPL fate

IPL chairman Rajeev Shukla said on Sunday that the Rajasthan Royals would wait and see what sanctions the ICC imposes on Smith before deciding on his future as the franchise's captain, PTI reported.

But a Board of Control for Cricket in India official, who requested anonymity, said that Smith and Warner (captain of Sunrisers Hyderabad) were unlikely to lose their IPL contracts. Reuters