NEW DELHI - An Indian court remanded in custody the head of a popular Indian Internet auction site owned by US giant eBay Inc. over the sale of a video showing teenage students engaging in oral sex reports AFP.

Lawyers applied for bail for Avnish Bajaj, country manager of Baazee.com whom media reported was a US citizen and Harvard Business School graduate, when he appeared in a New Delhi city court Saturday a day after his arrest. But the judge ordered Bajaj to remain in custody for a week, saying the alleged offence did not warrant the granting of bail, the Press Trust of India said.

The two-and-a-half minute video clip involving a teenage girl and boy from a well-known Delhi private school has shocked parents in sexually conservative India.

The girl was photographed performing oral sex on a classmate who filmed the act using his mobile phone camera. The images were then circulated to other students in the school who had mobile phones.

Public transmission and sale of pornography is a crime in India but possession of pornography and viewing it in private is not.

Police said Bajaj was booked under the Indian Information Technology Act which prohibits transmission and sale of obscene data electronically.

He was taken into custody after police arrested a student at an elite college for selling the video on Baazee.com

If convicted, Bajaj could be jailed for up to five years, fined 100,000 rupees (2,220 dollars) or both, police said.

Baazee.com said in a statement it was "outraged" at Bajaj's continued detention and said it would continue its efforts to "dismiss this baseless case immediately."

"Baazee.com is an online marketplace -- a trading platform that offers buyers and sellers an opportunity to transact. Unlike a retailer, Bazee.com does not own or sell any of the goods that are listed on the site," spokeswoman Deepa Thomas said.

"It is distressing the police have chosen to misdirect their energies towards the baseless charges against Mr Bajaj and turn a blind eye to the thousands of other sellers in Delhi and other places where these and other clips are being sold in shops," she said.

After the video was circulated among the pair's classmates, it made its way to Web sites and video discs. News reports said a number of people had bought copies of the video via the portal.