Matthew Wade was preferred to Travis Head in the Australian batting line-up. (Photo by Ryan Pierse/Getty Images)
The third Test between Australia and India is delicately poised after the second day of action at the SCG.
India is trailing by 242 runs with eight wickets in hand, with stalwarts Ajinkya Rahane and Cheteshwar Pujara surviving a tough passage of play before stumps.
The hosts eventually crumbled to 338 all out, with Smith the last to depart following a superb piece of fielding from Indian all-rounder Ravindra Jadeja.
The Indian openers put on a crucial 70-run partnership before Australia’s seamers struck in the final session.
Josh Hazlewood claimed his 300th international wicket on his 30th birthday, removing Rohit Sharma for 26 caught and bowled.
Meanwhile, Labuschagne perched himself at short leg early in India's innings, repeatedly asking Shubman Gill a few friendly questions.
“Who is it? Come on who is it? Sachin? Virat? AB? Laxman, Laxman? Whose your favourite player?” Labuschagne asked.
Gill did his best to ignore the sledging, but eventually replied, "I'll tell you after the match.”
India is 2/96 at stumps, with play scheduled to continue on Saturday morning at 10am local time.
Updates
Indian skipper survives LBW shout
Indian captain Ajinkya Rahane would count himself lucky to survive an LBW shout against Nathan Lyon.
Rahane opted not to play a shot against a Lyon delivery which darted back into the pad.
However, the on-field umpire gave it not out after the Aussies appealed for LBW.
Australian skipper Tim Paine called for DRS just before the 15-second clock expired.
Hawkeye replays showed the ball would have just clipped the off stumps, meaning the on-field decision stayed and Australia retained their review.
India is 2/93 after 41 overs, with Rahane on five and Cheteshwar Pujara on six.
Rohit will be so disappointed falling in that manner. But he's protected the rest of the batting line-up from the new ball, so that's commendable. Pujara daddy innings loading. #AusvInd
Nathan Lyon has been denied a crucial wicket after the third umpire overturned an on-field decision.
The Australian tweaker thought he had removed Indian opener Rohit Sharma after Matthew Wade claimed a catch a short leg.
The umpire raised the finger, but Sharma quickly reviewed the decision.
Replays showed no sign of an inside edge or any glove, and even though Wade's body was blocking the on-side Hot Spot camera, there was enough evidence for the third umpire to overturn the decision.
Sharma survives, and India is 0/61 in the 25th over.
Unlike Australian commentators, I do not find the mannerisms of Steve Smith and Marnus Labuschagne cute. They are both excellent batsmen. One is 31 years old, another is 26. Both should be capable of behaving like normal grown-up men.
Indian openers Shubman Gill and Rohit Sharma have survived through to tea, respectively compiling 14 not and 11* not out.
The visitors are 0/26 at the break, with play scheduled to resume at 4pm local time.
'Genius' ends Australian innings
A remarkable piece of fielding was needed to remove Steve Smith on Friday, whose masterclass comes to an end on 131.
After the flicking the ball through to square leg, Smith scampered through for a quick two.
However, Indian all-rounder Ravindra Jadeja elegantly picked up the ball and pinged it at one stump, finding the Australian batsman short of his ground.
"Brilliant piece of fielding," Fox Cricket commentator Mark Howard exclaimed.
The SCG spectators gave Smith a standing ovation as he made his way off the ground, with Australia's innings coming to a close at 338 all out.
Starc's cameo comes to abrupt end
Mitchell Starc provided some entertainment for the SCG spectators before attempting one slog too many.
The tall left-armer skied a catch off Naveep Saini's bowling, making his way back to the pavilion for 24.
Soon after, tailender Nathan Lyon followed suit, trapped LBW by Ravindra Jadeja for a duck.
The last batsman Josh Hazlewood waltzes to the middle, with Australia 9/315. Steve Smith remains not out on 109.
Steve Smith has plundered his 27th Test century at the SCG.
The 32-year-old brought up the milestone with a delicate glance through square leg, and the Sydney crowd roared.
The Australian batsman has been a shadow of his former self in recent months, but the greats always know how to bounce back.
Smith has not scored a Test century on Australian soil since the 2017/18 Ashes series, before his suspension and the ball-tampering scandal in South Africa.
He needed 201 deliveries to bring up the milestone in a knock which featured 13 boundaries.
It’s also the first Test century by an Australian against India since 2017.
"It's an outstanding hundred from an outstanding cricketer," former Australian wicketkeeper Adam Gilchrist said on Fox Cricket.
"A statement of the highest quality for Steve Smith … this fine batsman rises again."
Former Test captain Ricky Ponting said on Channel 7: "There'd been questions asked … 'Were we worried about the slump that he's in?'
"Absolutely not. You never got worried about class players because you know a big innings is just around the corner."
