Bhullar had appealed against his hanging because he said the President of India had taken eight years to reject his petition for mercy. The delay was grounds for commuting his sentence to life imprisonment, his lawyers had argued.
The judges disagreed and said, "It is paradoxical that the people who do not show any mercy or compassion for others plead for mercy." (Read: Full text of court order in Bhullar case)
Today's judgment will impact 16 other prisoners on death row who have pleaded in different courts that their appeals for clemency were pending with the President for years before they were rejected.
In Tamil Nadu, the verdict will be carefully assessed to determine the fallout on the case of three men who have spent 22 years in jail for their role in the assassination of former Prime Minister Rajiv Gandhi. Their appeal for clemency was rejected after 11 years in August 2011. All parties in the state have passed a resolution stating that they should not hang.
Bhullar's wife Navneet Kaur, who was in court today, said his mental health has been affected by the uncertainty over his fate. "Our pleas of delay as medical grounds were not considered," she told NDTV.
The verdict is politically sensitive for Punjab, where many continue to sympathise with former Khalistan separatists and militants including Bhullar and Balwant Singh Rajoana, who has been convicted for the assassination of former chief minister Beant Singh.
Last year, the Centre had stayed Rajoana's hanging, following a mercy petition filed by Sikh body, Shiromani Gurdwara Parbandhak Committee (SGPC) that has been actively backed by the Punjab government and other political parties in the state.