Left without money due to failing crops, debt-ridden farmers in Bundelkhand, Uttar Pradesh, have reportedly been selling their wives to money lenders for Rs 4,000 - 12,000 (£50-150).
The more beautiful the woman, the higher the price that she fetches, it was claimed.
The deals are allegedly being settled on a legal stamp paper under the heading "Vivaha Anubandh" meaning Marriage Contract. Once the new "husband" is tired of the woman, she is allegedly sold to another man.
The National Commission for Women (NCW) is now sending a team to investigate the reports.
Girija Vyas, chief of the NCW, said: "It is awful and unbelievable that it still happens in the country, and that too in Uttar Pradesh where the chief minister is a woman.
"We are sending a team to find out the details and have asked for the report within 24 hours."
She added that the commission had also written a letter to the state's chief minister.
One of the victims said: "My husband sold me to another man for Rs 8,000 (£100) only. My buyer took me to the court to make our wedding look legal. During the trip I got the chance to escape."
In most cases, the women are illiterate and cannot read what is written in the "contract".
A farmer who helped expose the situation to the Indian media said he is now being harassed.
"I was summoned to the police station and questioned," the man who is known only as Kalicharan said.
"I told them I had spoken to the media because no one was listening to us. But they threatened me and said I was lying. My wife was also called to the police station."
With reports suggesting that thousands of farmers in the region are involved, the situation has spiralled into a major political crisis.
Opposition parties are blaming the Bahujan Samaj Party (BSP) government led by chief minister Mayawati for the problem.
The state Congress president Rita Bahuguna Joshi said: "It is a painful situation. I am sending a team of Congress workers to help these women."
A spokesman for leading opposition, the Bharatiya Janata Party, said: "Both the BSP-led state government and the Congress at the centre are responsible for this.
"The centre has been talking of creating a separate authority for Bundelkhand while some factions want a state. Nobody is helping these farmers."
Erratic rainfall in the region this year is one of the main causes of failing crops.