India's National Human Rights Commission has ordered an investigation into the killing of 20 alleged red sandalwood smugglers last week after hearing the testimony of two witnesses.
The two men have contested the police's account that the victims were shot in an exchange, suggesting instead the killings were staged encounter deaths.
The police have denied the claim.
The commission has ordered the men - local villagers - be given protection and an investigation be carried out.
Rights activists say more witnesses are willing to come forward to support the allegation that the men were killed in a staged encounter near the holy town of Tirupati in the state of Andhra Pradesh on 7 April.
The police say the killings took place after they challenged a group of 100 red sandalwood smugglers who attacked them with axes and stones.
Sandalwood smuggling is rampant in southern India, with a tonne selling for tens of thousands of dollars on the international black market.
Red sandalwood or red sanders is a species of tree endemic to the Western Ghats of India.
The tree is prized for its rich red wood, mainly for making furniture, and is not to be confused with the highly aromatic sandalwood trees that are native to southern India.
Most of those killed are believed to be Tamils and there was an angry reaction in Tamil Nadu to the killing.
Correspondents say the loggers are often tribespeople or other poor migrant workers from Tamil Nadu.
India banned the sale of red sandalwood in 2000.