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The woman, identified as Karami Murmu, is a resident of Mayurbhanj district’s Khunta.
Police said Karami’s husband was unaware of the incident since he was away in Tamil Nadu working as daily wage earner.
According to police, Karami was allegedly unhappy over the birth of her second daughter and had raised concerns about her upbringing with her neighbour Mahi Murmu, who brokered a deal and arranged a buyer for the child.
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When the kid’s father Musu Murmu returned home from Tamil Nadu and inquired about his second daughter, his wife claimed that she had died, while his neighbours informed him about the deal. Unsure of what had happened, he lodged a complaint at Khunta police station on Monday.
Police immediately swung into action and arrested Musu’s wife, the couple who bought the baby and the mediator on Tuesday.
Mayurbhanj SP Battula Gangadhar said the woman had gone to a market with her kid but returned alone. When villagers asked her about the child, Karami told them that she had died, he said.
The SP said police have rescued the kid and sent her to Childcare.
“We have booked those involved in the crime including the mother under Section 370 IPC (Human Trafficking),” added Gangadhar.