Furious Indian cricket officials suspended their team's tour of Australia today while they appeal a ban on Harbhajan Singh for racial abuse.

The spin bowler was banned for three Tests after he was alleged to have called Andrew Symonds – the only black player on the Australian team – a "monkey".

The Indian cricket board (BCCI) responded by halting the tour with two matches of the four-Test series to play – although Australian officials remained confident that the row could be resolved before the next Test in Perth on January 16.

In a statement, the BCCI said that it was suspending the tour until the International Cricket Council had hear its appeal on Harbhajan's ban.

"The Indian board realises the game of cricket is paramount but so, too, is the honour of the Indian team and, for that matter, every Indian," it said. "To vindicate its position, the board will fight the blatantly false and unfair slur on an Indian player."

In its statement, the board did not specifically deny that Harbhajan used the word, but Ratnakar Shetty, the BCCI's chief administrative, said later that the case against him had been based on "hearsay".

"He (Singh) says he has not said what has been alleged and the match referee has made out a case based on hearsay," Mr Shetty told BBC Radio Five Live.

"There are two Australian cricketers who said they heard him saying the particular word and their are two Indian cricketers who said he has not said it.

"Sachin Tendulkar for one definitely refuses to accept that he has heard this word. So I don’t understand how the match referee could arrive at the conclusion based on the conclusion of two players because there is no other evidence."

The India team will now stay in Sydney rather than travel to Canberra for a tour match on Thursday as they await the appeal against the decision by Mike Procter, the South African match referee, who was persuaded Harbhajan had used the word and that "he meant it to offend on the basis of Symonds' race or ethnic origin".

The ICC have yet to receive an official appeal against Harbhajan's ban. Should they do so, however, ICC procedure means the player is likely to have to wait several days to contest the verdict that he was guilty under the world governing body's code of conduct.

"Assuming an appeal is lodged, then the ICC has 48 hours to appoint an adjudicator to hear the appeal," an ICC spokesman said. "Then the appeal will be set up as soon as practicable."