A woman in Karimnagar district of Telangana allegedly sold her infant granddaughter for Rs 1.10 lakh, police said on Saturday.
According to police, the infant's father got married about three years ago.
He was living in Hyderabad with his wife.
The mans wife gave birth to a baby girl one month ago and she was staying at her mothers place at Veenavanka in the district, they said.
The mans mother-in-law allegedly sold the baby on Friday as she was in need of money, they said.
After coming to know about the matter, the infant's father complained to the state government's Child Welfare Committee (CWC) yesterday.
The committee inquired about the issue and referred it to police, along with a report.
Based on a complaint from the man, the Veenavanka police registered a case under the Juvenile Justice Act against the infant's grandmother and the alleged purchaser.
The infant and her mother were sent to the child care centre at Karimnagar.
Efforts were on to arrest the grandmother and the alleged purchaser, police added.