Varma has also said rubbished reports that he was forced to give a preview of his film to a Rajan representative to pacify the don, who is reported to be based in Malaysia.
"I never take calls from any number that I do not recognise," Varma, looking a little harried, told at his suburban Mumbai office, which is called, after his company, The Factory.
"So the question of anyone calling me just doesn't arise. I would never take such a call. No one called me and I never showed the film to anyone - that's the truth."
Varma, once again, also denied that his film had anything to do with the life of Dawood Ibrahim, who is said to be based in Karachi, Pakistan, and is one of the most wanted men in the subcontinent.
"'D' is not about Dawood," said Varma. "I keep saying this. The film is about a character called Deshu. It has nothing to do with Dawood. Dawood now has this Hindu-Muslim divide connotation, which has nothing to do with my film.
"My film is about a man who corporatised the Mumbai underworld and became its leader. There is no religion in it."
Ibrahim is widely believed to have masterminded the 1993 serial bomb blasts in Mumbai, which killed around 300 people. Experts believe that the blasts came in response to the destruction of the Babri Masjid in Ayodhya.
In the recent past, Chhota Rajan, once a Dawood associate, has tried to portray himself as a Hindu nationalist don as opposed to his archrival.
"My film has nothing to do with religious colouring. I know from the time I announced it many people were worried how I will portray him. But my film has nothing to do with him," said Varma.
In the last decade, some of the avant garde filmmaker's best known work has been on the infamous underworld of India's financial and film capital. Intimate details in films like "Satya", "Company" and "Ab Tak Chhappan" have led to widespread speculation that Varma has some internal source of information on what goes on within the gangs.
But Varma said all his stories were mere fiction.
"When I make films I become part psychiatrist - I get into the minds of the characters. I tried to understand what kind of people they are. See there might not be any difference between the appearance of a doctor, engineer or gangster - the difference is in the mind and that's what I study.
"I have never come across any gangster or any gang activity in all my years in Hindi films. Everything that I do is fiction."
Mumbai police though feels that there is a threat to his life and Varma has a 24-hour plainclothes machine gun-wielding bodyguard.
"That's the police's perspective. I never think that there is any threat to me. I don't think I've done anything to offend anyone," said Varma.