Police, in a statement responding to a Reuters request for information on Malik’s death, said they found a man with gunshot wounds when officers responded to a reported shooting shortly before 9.30am (1630 GMT).
The Royal Canadian Mounted Police (RCMP) statement did not name the man but said he died at the scene in Surrey, British Columbia. An RCMP spokesperson said they could not name the victim and the investigation was ongoing.
Local media, citing sources and a witness, reported that the man was Malik.
The bombing of Air India Flight 182, which exploded over the Atlantic Ocean in 1985, is one of the deadliest airliner attacks in history.
Police alleged it was plotted by Sikh extremists living in Canada to get revenge on India for storming the Golden Temple of Sikhism in Amritsar in 1984.
RCMP, in their statement on Thursday, said the murder appeared to be targeted and they found a suspect vehicle fully ablaze.
Authorities were still looking for the suspects and a second vehicle that may have been used as a getaway vehicle, RCMP said.
Malik and Ajaib Singh Bagri, a sawmill worker from Kamloops, British Columbia, were charged in 2000 with blowing up Flight 182.
They were also accused of killing two baggage handlers who were killed when a suitcase bomb, which police say was designed to destroy another Air India plane over the Pacific Ocean, exploded at Narita airport. in Japan.
Both were acquitted of the charges in 2005 after a trial that lasted almost two years and heard from 115 witnesses.
Canadian police have been criticized for an investigation that some say was bungled and resulted in just one conviction – Inderjit Singh Reyat, who pleaded guilty in 2003 to manslaughter for helping collect the materials used to make bombs.
The Canadian government also issued a formal apology in 2010 to the families of the Air India victims, saying authorities failed to act on information that could have prevented the attack or caught those responsible.