Raising the issue during Zero Hour, AIADMK leader P Venugopal said his party was "not satisfied" with the explanation of Prime Minister Narendra Modi and Home Minister Rajnath Singh on the issue given to the House on Monday.
Venugopal wanted to know what sort of clarification has been sought by the Centre from the state government.
Prime Minister Modi had on Monday denounced the release of Alam and Home Minister Rajnath Singh had said his ministry had sought clarifications from the state government over the issue.
Venugopal said what has "added insult to injury" is that the state Chief Minister has asked the police to release a dozen more separatists including some political prisoners.
He asked the BJP has to come out of the coalition government in the state and the Centre should ban PDP for taking up the separatist cause.
His party colleague Anwar Raza said the Mufti government should be dismissed as it was "acting against sovereignty of the nation."
This was the second day that the issue of Masarat Alam was raised in the Lok Sabha. Yesterday, Prime Minister Narendra Modi and Home Minister Rajnath Singh had made statements in Parliament on the controversy.