The parents, Sandhya Devi and Ashok Kumar, allegedly sold the baby to a neighbouring couple, who have also been arrested and bailed.
The incident reportedly took place in the Sriganganagar district.
Police said they were also probing the role of six other people in the case.
They include a government official.
Mr and Mrs Kumar allegedly sold the baby boy to their neighbours – Vinod Agarwal and his wife Shakuntla.
The baby was born on 31 July and handed over to the couple on 3 August.
Mr and Agarwal allegedly offered to pay for the baby when they found out that Mrs Kumar was pregnant.
Her three-year-old son has suffered from a debilitating illness since birth and is disabled.
“Since the couple could not pay for the treatment of their son, a middleman lured them to sign a deal with the neighbours, who were wanting a child,” senior police official Sharvandas said.
Mr and Mrs Kumar lodged a complaint with police earlier this week saying that the Agarwals had not paid them all the money to which they had been promised.
The baby has now been handed back to the Kumars