It is if the nation harboring the terrorist refuses to cooperate with an interpol order related to murder and the person is actively killing politicians in your country. What exactly was India supposed to do since Canada refused to work with them? Sit on their hands and watch their elected reps get assassinated?
The accepted response is escalating the situation on the diplomatical level. Imposing sanctions if necessary. Getting other countries impose them as well. And, in extreme cases, trying to get the UN Security Council authorize military action.
Well they killed him and haven’t had any real consequences so I would say killing him was also an accepted response. It was accepted by everyone realistically able to do anything about the situation.
Not facing real immediate consequences is not the same as acceptance. Especially when we are talking about acceptance in the moral/normative sense.
Besides, you should wait at least a decade or two before talking about consequences. Things don't change that quickly in international relations, because the stakes are so big. But they do change, as you can see from the relations between Russia and the West.
There was another "suspicious" event this morning (quotes because I don't understand the politics enough to make a judgement):
https://www.business-standard.com/india-news/sukha-duneke-wh...
The source definitely has a view, but "one person's freedom fighter..." and all that.