Indian diplomat Devyani Khobragade is under the scanner after the government, it is learnt, found that her two daughters had American passports as well as Indian diplomatic passports — a crime under Indian law as it amounts to dual citizenship.

The discovery has caused considerable disquiet as the government took unprecedented retaliatory measures against US diplomats after Khobragade was arrested on charges of visa fraud and allegedly mistreated in New York.

Government sources said getting US passports for her daughters indicated Khobragade kept her options open to benefit from the “best of both worlds”. Khobragade’s daughters, aged four and seven, are in New York with their father, an American citizen.

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According to rules, a diplomat’s spouse is also expected to take up Indian citizenship. Although Khobragade’s husband has applied, the citizenship has not come through because of stringent home ministry rules which require the applicant to stay in India for a stipulated period.