Swiftly moving to control damage, High Commissioner Nadir Patel cancelled the invite for the dinner, hosted tonight for Trudeau, while the external affairs ministry said it will "ascertain" how Atwal entered India.
"The High Commission has rescinded Mr. Atwals invitation. We do not comment of matters relating to the PM's security," the Canadian mission said in a statement.
Reacting to the controversy, Trudeau told reporters "Obviously we take this situation extremely seriously. The individual in question never should have received an invitation and, as soon as we found out, we rescinded the invitation immediately... The member of Parliament who included this individual has, and will, assume full responsibility for his actions."
Atwal was convicted for trying to kill the then Punjab minister Malkiat Singh Sidhu in Vancouver in 1986.
When asked how Atwal got a visa, external affairs ministry Spokesperson Raveesh Kumar said the government is "ascertaining" details how he got a visa to enter India.
"There are two aspects of this. One is his presence at the event. I think this is something which should be addressed by the Canadian side. They have said that it was an oversight. And that is the reason the invitation for the reception tonight has been withdrawn."
He also said that the fact the ministry issued a visa means that Atwal is not an Indian national.
On whether Atwal can be arrested in India, Kumar said there were cases against him for which he has served his sentence. The ministry is not aware whether there are cases against him in India, that has to be checked with the law-enforcement agencies, he added.
On his part, Trudeau had assured Singh that his country does not support separatism in India or elsewhere.
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