Smith was one of three Australian wickets to fall in quick succession before lunch in a marked reversal of England's fortunes from their horrendous third day.
However, it did not stop Australia from extending their lead to a massive 240 as they reached 643 for 7 at lunch on the fourth day, with Tim Paine on 41 and Pat Cummins on 36, in reply to England's 403 all out.
The home side lead the five-Test series 2-0 and have five sessions remaining to secure the Ashes with by winning the last-ever Test to be played the WACA Ground.
Smith resumed on 229 and added just 10 runs before being adjudged leg before wicket on review after James Anderson's confident shout had been turned down by on-field umpire Chris Gaffaney.
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The review ended a chanceless 399-ball epic highest Test innings by Smith, which included 30 fours and one six.
The other overnight batsman, Mitchell Marsh, a few minutes earlier had failed to add to his 181 when he was trapped leg before wicket by Anderson to end a 301-run partnership with Smith.
They were lucky not to lose Paine for 11 when he was given out looking plumb lbw to Anderson, only for a review to show the ball would have gone over the leg stump.
England have reportedly been unhappy with the implementation of decision reviews in the match and according to one UK newspaper have lodged an official complaint after Mark Stoneman was given out contentiously by the third umpire caught off a glove in their first innings.
In the space of three balls from Chris Woakes, one delivery went along the ground and one reared sharply, while a Stuart Broad delivery in the next over jagged alarmingly from leg to off.
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