A western Sydney man has been found mentally unfit to stand trial for his wife's murder, amid signs of delusional beliefs including that she "may have been a duplicate".

Baltej Singh Lailna used a kitchen knife to fatally wound his wife Kamaljeet Sidhu, 27, at their Quakers Hill home on May 20, 2020, the NSW Supreme Court was told on Monday.

Shortly after he contacted her brother and told him of the stabbing.

Later he made similar admissions to police along with paranoid statements.

Just a couple of weeks earlier he presented at Blacktown Hospital showing "at least some signs of delusional beliefs," Justice Peter Hamill said.

The 32-year-old has been charged with murder but on Monday Justice Hamill decided he was still not mentally and cognitively not fit to stand trial.

On April 24 police served Lailna with a domestic violence order but he continued to live and sleep in the same bedroom as Ms Sidhu who was studying at the time, the court was earlier told.

The couple were married for four years and moved to Australia from India two years earlier.

Forensic psychiatrist Jeremy O'Dea assessed Lailna in January and found he continued to suffer from severe treatment-resistant schizophrenia that was heightened by substance use disorder.

Following questions about what happened Lailna continued to show delusional beliefs, he said in a report.

"I told police I stabbed my wife because she was bashing me," Lailna told the psychiatrist.

"She was killing me because she was giving me the medication which was killing me. I don't know what it was, it stopped my breathing," he said.

Dr O'Dea also asked him about his answer to police that his wife, brother and others were conspiring against him in a large fraud.

"Everyone was working to kill me, I dunno, now it's the police, doctors, and lawyers," he answered.

When asked what his charges related to, he said "my lawyer knows, I dunno".

Further psychotic symptoms were noted after his arrest in May, with Lailna questioning whether the victim was in fact his wife saying "It may have been a duplicate".

The accused did not demonstrate an adequate understanding of his charges nor comprehend the available pleas and their consequences, Dr O'Dea reported.

Another one of his reviewing psychiatrists Richard Furst agreed with the assessment and added his lack of insight would act as a barrier to him raising relevant defences.

Both doctors advised treating his ongoing symptoms with another anti-psychotic medication Clozapine.

While Justice Hamill concluded Lailna was not mentally fit now, he found he may be within 12 months if the new treatment improved his condition.

Lailna remains on remand in prison.