A group of 157 asylum-seekers in custody on the high seas for weeks will be taken to Australia and held until consular officials confirm their nationalities, authorities said Friday.
The development follows lawyers acting for about one-third of those on board -- thought to be mostly minority ethnic Tamils from Sri Lanka -- taking their case to the High Court.
They argued that any transfer to Sri Lanka would be illegal, with concerns about the way they were screened.
The boat left India last month and Australia said it was intercepted outside its migration zone.
The asylum-seekers, including children, have since been held on board an Australian customs ship while their legal status is determined.
Australian Immigration Minister Scott Morrison announced the asylum-seekers would be taken to Australia where Indian consular officials would determine their identities.
"It is our intention those who can be returned should and must be returned," he said, adding that India had agreed to take back any of its citizens and would also consider taking Sri Lankan nationals who are Indian residents.
They will be the first boatpeople to arrive in Australia in nearly seven months but Morrison ruled out any of them being resettled in the country, in line with Canberra's tough immigration policies.
"They won't remain in Australia. They will not be resettled in Australia," he said.
Any boatpeople who arrived in Australia after July 19, 2013 cannot be resettled in the country, regardless of whether they are genuine refugees. They are instead sent to detention facilities or resettled on islands in the Pacific.
Asked what would happen to any people on the boat who were neither Indian nationals nor residents, Morrison replied: "These are matters to be determined."
Lawyers have been seeking a court order that prevents those on the boat being sent to either Sri Lanka, Nauru, or Papua New Guinea.
Greens Senator Sarah Hanson-Young said Morrison was making Australia an international disgrace over the issue.
"He's making it up as he goes along," she told reporters in Adelaide after the minister's announcement.