Though it is common in China to give away cash gifts as tokens of appreciation even in formal settings, the incident, seen as a borderline violation of protocol, caused a diplomatic headache for the Indians.
The pilots, who accepted the gift neatly packed in two separate envelopes thinking it to be mementoes, were surprised to see wads of cash and reported the matter to their superiors.
Reports said Liang was "pleased" with the way the pilots handled the flight in the stormy monsoon weather.
Since returning the tip from a visiting foreign dignitary will be perceived as rude, Indian officials have decided to deposit the money in the government treasury.
The officials said the Chinese delegation was probably not aware of the rules that forbid the government officials from accepting cash gifts, a BBC report said.
However, the incident has aroused suspicions in the Indian quarters over whether the Chinese gesture was a deliberate attempt at causing a stir.
The Times of India reported quoting a retired Chinese government official that cash gift in Indian currency ought to involve detailed planning and that Chinese leaders offering cash to the defense officials in foreign countries was previously unheard of.
"China observers have often suggested that bribes have played a key role in the country's success in Africa," the report said. "Question is if Liang was briefed wrongly about Indian conditions or he was deliberately trying to embarrass IAF pilots."
British newspaper Daily Mail said the cash gift was a "pretty smart way to insult India."
"Those were just gauche reminders of the way the Chinese look at India as being not quite a place of taste and refinement," remarked the report, which also called for the Indian delegates to have "a bunch of notes ready" the next time they visit China.
Beijing termed Liang's five-day visit a success, but declined to comment when asked about the cash gift, the Hindu reported. China's Foreign Ministry spokesperson Hong Lei said: "I am not aware of the specifics."
The report, which quoted Chinese analysts without naming them, said the incident was possibly a gaffe, adding that it was the responsibility of local embassies to brief the visiting delegation about the host nation's protocols and cultural sensitivities.