Canada worked "very closely" with the United States on intelligence that Indian agents had been potentially involved in the murder of a Sikh leader in British Columbia earlier this year, a senior Canadian government source said on Tuesday.

Prime Minister Justin Trudeau announced on Monday that domestic intelligence agencies were actively pursuing credible allegations tying New Delhi's agents to the shooting of Hardeep Singh Nijjar, 45, in June.

"We've been working with the U.S. very closely, including on the public disclosure yesterday," the source said. The evidence in Canada's possession would be shared "in due course," said an anonymous official, according to Reuters.

Trudeau on Tuesday told reporters that the case had far-reaching consequences in international law, and urged the Indian government to take the matter seriously and help Canada fully investigate the matter.

India quickly rejected the allegations and dismissed Trudeau's assertion as "absurd."

"Allegations of Government of India's involvement in any act of violence in Canada are absurd and motivated," the Indian Ministry of External Affairs said in a statement on Tuesday.

The Indian government on Tuesday expelled a senior Canadian diplomat, asking him to leave the country within the next five days, which came after Canada expelled India's top intelligence figure on Monday.

India's foreign ministry did not disclose the name or rank of the Canadian diplomat and said in a statement, "The decision reflects the government of India's growing concern at the interference of Canadian diplomats in our internal matters and their involvement in anti-India activities."

U.S. authorities, earlier on Tuesday, said they supported Canada's investigation.

"We have been in close contact with our Canadian colleagues about this. We're quite concerned about the allegations. We think it's important there is a full and open investigation, and we would urge the Indian government to cooperate with that investigation," a senior State Department official said.

Now some, including Canada's Conservative opposition leader, Pierre Poilievre, are urging Trudeau to show the evidence that the government has in hand.

Jesse Singh, founder and chairman of the community group Sikhs of America, told an event hosted by Washington's Hudson Institute think tank that Trudeau has failed to provide any proof.

"It's just something that he said is a 'credible allegation,' with no proof at all. And I think we'll have to wait to see if there is any proof there and then I think further decisions can be taken," Singh added.

(With input from Reuters)