A woman stumbled upon a 4.39 carat diamond when she went to collect firewood in a forest area in Madhya Pradesh's Panna, famous for its precious stone mines.
As per the private estimates, the diamond may fetch up to Rs 20 lakh at the auction.
Genda Bai, a resident of Purushottampur, went to the forest to collect wood on Wednesday, but found a precious stone on Wednesday, diamond inspector Anupam Singh said.
"The woman later reached the Diamond Office and deposited the stone, which is a 4.39 carat diamond," he said.
The official said that the raw diamond would be auctioned and the proceeds would be given to the woman after the deduction of the government royalty and taxes.
Talking to the reporters, Genda Bai said that she has been selling firewood after collecting it from the forest and also doing labour work to run the house.
She said that she has four sons and two daughters, who are of marriageable age.
The money received from the auction will be used for the construction of her house and marriage of her daughters, she said.
Panna, a district in the impoverished Bundelkhand region of Madhya Pradesh, is known for its diamond mines.