"It's just a slap with a wet blanket really."
Mr Scannell said he was shocked at Judge Couch's decision.
"From our point of view it's making sure that people don't think they can come to town and assault my taxi drivers and get away with it."
McNee's lawyer Nick Soper told Radio New Zealand his client had no memory of the incident.
She was taking heavy pain relief and had been drinking that night, he said.
"There is absolutely nothing in her life in any way, shape or form that indicates that she is a racist or holds any sort of prejudiced thoughts towards others.
"Which makes the whole episode such an aberration."
Police today said they opposed a discharge without conviction and an employment investigation had been launched.
Southern District Commander Superintendent Andrew Coster said police expected the highest standards from staff in both their personal and professional conduct and the behaviour described in the court case involving McNee did not align with police organisational values or its code of conduct.
McNee remains on leave without pay, Mr Coster said.
Mr Paramanathan was described as "courageous" by Race Relations Commissioner Dame Susan Devoy for bringing the case to the courts.
"People like ... Ganesh Paramanathan make our country a better place to live in by standing up to racial abuse and demanding change.
"Racism has no place in our country and that includes late night taxi rides."
University of Auckland Associate Professor of Law Bill Hodge said the judge had taken the view that a conviction for the offence was out of proportion to the crime.
"So now the police have the option for the appropriate employment step to take."
McNee was ordered to pay emotional reparation of $300 to the victim, a further $155 for loss of wages while the victim gave evidence in an earlier court hearing, and $388.13 to Queenstown Taxis for the costs of extracting video evidence.
She was found to have told Mr Paramanathan to "F*** to India. You come here and get all the Kiwi jobs; eat your f****** curry and f*** off to India. This is a Kiwi job."
A Crown Law spokeswoman said it was too early to say if there would be an appeal against the decision.
