The channel also snipped the sound when Dustin Lane Black, who wrote the screenplay for Penn's film 'Milk', addressed "all the gay and lesbian kids".
Milk is the story of Californian gay rights activist Harvey Milk.
Both Penn and Black supported gay marriage in their speeches and urged for equal rights for homosexuals.
Penn opened his speech by calling the audience "commie, homo-loving sons of guns".
But the censoring of the evening telecasts of the awards ceremony by the broadcaster led gay Asians to voice their anger.
"As a gay man, I am truly offended. Stop censoring the words that describe who I am," The Telegraph quoted Pang Khee Teik, a prominent Malaysian arts commentator, as writing in a letter sent out to several media organisations.
Pang said that the move "sent a message ... that gays and lesbians are still shameful things to be censored from the public's ears."
Those using Internet forums in Singapore and India were also livid over the censored speeches.
However, Jannie Poon, STAR's Hong Kong-based spokeswoman, stressed that the company had no intention of upsetting any viewers.
But she claimed that the channel had "a responsibility to take the sensitivities and guidelines of all our markets into consideration."
Viewers first noticed that the words were silenced when Black offered a tribute to Milk while accepting the Oscar for best original screenplay. (ANI)