After plunging over 716 points during the day, the 30-share index pared some losses but still settled 190.10 points or 0.60 per cent lower at 31,371.12.
Similarly, NSE Nifty declined 42.65 points, or 0.46 per cent, to 9,196.55.
Reliance Industries was the top loser in the Sensex pack, plunging over 6 per cent, followed by Asian Paints, Kotak Bank, HUL, HDFC Bank and ONGC.
On the other hand, NTPC, Bharti Airtel, ITC and IndusInd Bank and PowerGrid were among the top gainers.
According to traders, weak cues from global markets on fears of a second wave of coronavirus infections spooked investors across Asia.
After weeks of no new cases, Wuhan, the central Chinese city where the outbreak first emerged, reported six new infections in two days and South Korea announced its biggest spike in new cases in more than a month.
Following the reports, bourses in Shanghai, Hong Kong, Tokyo and Seoul finished in the red.
Stock exchanges in Europe were trading on a mixed note in early deals.
In India, the death toll due to COVID-19 rose to 2,293 and the number of cases climbed to 70,756 on Tuesday, according to the health ministry.
Globally, the number of cases linked to the disease has crossed 41.77 lakh and the death toll has topped 2.86 lakh.
Meanwhile, international oil benchmark Brent crude futures were trading 1.69 per cent higher at USD 30.13 per barrel.
On the currency front, the rupee surged 22 paise to provisionally close at 75.51 against the US dollar. ANSMKJ