The veteran will sit out the World Cup after picking up a lengthy suspension for "discriminatory behaviour" following a qualification play-off win over Iceland in November
In the wake of his nation's play-off victory in Zagreb last month, the 36-year-old addressed the crowd with a microphone, saying: "For the homeland". In response to Simunic's call, the fans replied: "Ready!"
The call was used by the far-right Croatian rulers the Ustashas, who took a pro-Nazi stance during World War II before being dissolved in May 1945.
And Fifa has moved to hand the veteran defender a lengthy ban, meaning he will sit out next summer's tournament in Brazil.
"After taking into account all of the circumstances of the case, and particularly given the gravity of the incident, the committee decided to suspend the player for 10 official matches," Fifa said in a statement on Monday.
"The committee took note that the player, together with the crowd, shouted a Croatian salute that was used during the second world war by the fascist Ustasha movement.
"As a consequence, the committee agreed that this salute was discriminatory and offended the dignity of a group of persons concerning, inter alia, race, religion or origin, in a clear breach of the Fifa Disciplinary Code."
Croatia have been drawn against Brazil, Cameroon and Mexico in Group A of the World Cup and will contest the opening game against the hosts on June 12 in Sao Paulo.