However, the US is talking with India at the diplomatic level to address concerns of the Indian Government in this regard, the official said.
"It (American Embassy School) is not run by the embassy. Only about a third of the students there are American. We are in discussion with the government of India regarding issues they have raised concerning the school," State Department Spokesperson Jen Psaki told reporters yesterday.
"Since 1952, when the embassy exchanged diplomatic notes with the government of India to establish the American Embassy School, the school has succeeded in providing an international education in New Delhi for the children of diplomatic and expat business community," Psaki said.
A report in The New York Times said the school was being run on a land owned by the American government.
"A handout for new teachers at this city's exclusive American Embassy School, an academic oasis for children of American diplomats and other expatriates, offers some unusual guidance to female teachers whose husbands will also be teaching at the school," the daily reported.
"The female spouse should not state that she will be working," the handout states, instructing spouses to list their occupation on visa applications as "housewife," adding that "no sexism is intended on our part," the NYT said.
The report comes weeks after a diplomatic row between the US and India following arrest and indictment of Indian diplomat Devyani Khobragade in New York.
Psaki said the US is committed to addressing "these concerns" that have been raised.
"We will work those through diplomatic channels, and we've already had conversations at a very high level about them," she said.
Meanwhile, according to a 2011 report of Office of Inspector General of the Department of State, the American School in Mumbai had tax issues with the Indian government.
Parts of the declassified version of the report and publicly available is redacted.
"The school's director was optimistic about resolving the long-standing tax issues with the Indian Government. The consul general has drafted a memorandum of agreement for the school with the Maharashtra state government to formalise the status of the school as exempt from corporate taxes," said the report.
Though name and location of the American school has been redacted, from the content it appears to be that of the one located in Mumbai.