India has been pressing the UK to extradite Mallya after he lost his appeals in the British Supreme Court in May against his extradition to India to face money laundering and fraud charges.
"Now, we have been told that there is a secret legal matter and that his extradition cannot take place without its resolution... We are in touch with the UK government," External Affairs Ministry Spokesperson Anurag Srivastava said at a media briefing.
He said New Delhi has been in constant touch with the UK government after Mallya exhausted all legal remedies against his extradition to India.
The UK top court's decision marked a major setback to the 64-year-old businessman as it came weeks after he lost his high court appeal in April against an extradition order to India.
In June, India urged the UK not to consider any request for asylum by Mallya as there appeared to be no ground for his persecution in the country.
The UK government had indicated that Mallya is unlikely to be extradited to India anytime soon, saying there is a legal issue that needed to be resolved before his extradition can be arranged.
Mallya has been based in the UK since March 2016 and remains on bail on an extradition warrant executed three years ago by Scotland Yard on April 18, 2017.
The High Court verdict in April upheld the 2018 ruling by Chief Magistrate Emma Arbuthnot at the end of a year-long extradition trial in December 2018 that the former Kingfisher Airlines boss had a "case to answer" in the Indian courts.