Orthogonal time frequency space (OTFS) is a recent modulation scheme that robustly handles the time-varying channel in delay-Doppler (DD) domain. The DD domain is converted to a 2-dimensional grid where the information symbols to be transmitted are located. Index modulation (IM) is a scheme where the indices of the resource entities at the transmitter are used to convey the information. This increases spectral efficiency utilizing only a fraction of the transmitter resource entities. In this paper, Generalized Spatial-Index Modulation based Orthogonal Time Frequency Space System (GSIM-OTFS) is proposed in order to improve the reliability in mobile communication environments. The proposed system uses the benefits of generalized spatial modulation (GSM), IM, and OTFS. A framework for the average bit error rate performance (ABER) analysis is also proposed. Analytical expressions are verified using simulation results. Further, the results show that GSIM-OTFS provides better spectral efficiency (SE) and ABER performance compared to other existing IM schemes.