TJ Joseph, 52, had his right arm severed at the wrist as he was returning home from church with his mother and sister on Sunday, and has since undergone an operation to have the limb sown back on.
Joseph, a lecturer at a private Christian-run college in the southern state of Kerala, has been on bail since April after being arrested over a question in internal exams that some Muslim groups claimed included an insulting reference to the Prophet Muhammad.
"An eight-member gang blocked his vehicle and chopped off his right arm," B Sandya, inspector general of the local police told AFP.
"It was a planned operation. We suspect a radical Muslim group who targeted him before."
Sandya said police had traced the attackers' vehicle and made two arrests.
Five doctors worked for 16 hours to re-attach Joseph's hand, but the outcome of the operation was uncertain.
In the Kerala assembly, state Home Minister Kodiyeri Balakrishnan described the attack as "Taliban-type" and "barbaric".
Joseph's school, Newman College, has declined to reveal the precise nature of the exam question behind the dispute to avoid further inflaming inter-religious tensions.