Phantom Films and Balaji Motion Pictures led by Ekta Kapoor have co-produced the project which stars Shahid Kapoor and Kareena Kapoor Khan.
There are reports that the Abhishek Chaubey-directed movie has failed to get censor board's approval due to excessive swearing and drug consumption.
"To set the record straight, Udta Punjab has not been banned. The examining committee has deferred the decision to the Revising committee and the due process is on," Aman Gill, CEO of Balaji Motion Pictures Ltd said in a statement.
"We have not rejected the film (Udta Punjab). The process is on for it. There were some differences between the committee and makers. I don't know why they (producers" are saying film is not cleared, "Anurag Srivastav of CBFC told PTI.
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Earlier Kashyap had said the things are in process and hence film is far from being banned.
"For the record ,'Udta Punjab' is not banned. The examining committee has deferred the decision to Revising and due process is on. And due process takes it own time so please abstain for spreading a BAN rumour. There is nothing to speak on the subject as of now," the "Bombay Velvet" director tweeted.
"Udta Punjab" also stars Alia Bhatt and Diljit Dosanjh and is set to release on June 17.