The opposition Conservative Party raised the issue in Canadian parliament, demanding to know whether Mr Trudeau agreed with the remarks of the official, identified by the Canadian media as national security adviser Daniel Jean.
"Will the prime minister tell the house whether or not anyone in his office arranged, organised or participated in the media briefing provided to reporters that included the allegation that the Government of India was somehow involved in his embarrassing blunder in India?" asked opposition leader Andrew Scheer.
"Our professional, non-partisan public service does high quality work and when one of our top diplomats and security officials says something to Canadians, it's because they know it to be true," said Mr Trudeau in his response.
Reacting strongly to Mr Trudeau's remarks, the ministry of external affairs said, "We categorically state that the Government of India, including the security agencies, had nothing to do with the presence of Jaspal Atwal at the event hosted by the Canadian High Commissioner in Mumbai or the invitation issued to him for the Canadian High Commissioner's reception in New Delhi. Any suggestion to the contrary is baseless and unacceptable."
Jaspal Atwal was a Sikh separatist active in the banned International Sikh Youth Federation when he was convicted of a botched attempt to assassinate Punjab minister Malkiat Singh Sidhu in Canada in 1986.
In a huge embarrassment for Canada, Jaspal Atwal was photographed with Mr Trudeau's wife Sophie Trudeau and Canadian minister Amarjeet Sohi at an event in Mumbai last week. Amidst the row, the Canadian envoy in India withdrew an invite to Jaspal Atwal for a dinner hosted for the visiting prime minister.
After Mr Trudeau said he would take action against "the person responsible" for the invites, Canadian lawmaker Randeep Sarai had taken the blame and apologised.
The External Affairs Ministry said it is investigating how Jaspal Atwal got an Indian visa and why he was cleared for the Trudeau events.
After a lukewarm visit, this row won't help India-Canada ties in the near future. And as if to run home the point that Mr Trudeau isn't important enough, Prime Minister Narendra Modi went to the airport last night to receive the Jordanian king, something he hadn't done for Mr Trudeau.