The CSE study has found considerable amount of antibiotics in the tissues, muscles, kidneys and liver of over 40 per cent of chickens it tested.
"What's alarming is that the poultry industry, which is largely unregulated, is using regular doses of antibiotics as a growth-feed to ensure the chickens quickly gain weight and size," said Director General of CSE Sunita Narain.
These antibiotics are used to treat diarrhea, pneumonia and urinary tract infection.
The consumption of antibiotic-laden chicken may further accelerate the emergence of antibiotic-resistant bacteria, which are then transmitted to humans.
"This is a big worry. The fact is that we don't follow the best practices as far as antibiotics are concerned. This is a real cause of worry," says Dr Sanjeev Bhoi of the AIIMS trauma centre in the capital.
Currently there is no mandatory regulation on the use of antibiotics in poultry or livestock.
Poultry farms maintain that "antibiotics kill microbes in the intestines and they help absorb nutrients, better resulting in weight gain".
In fact, the report suggests that several of the poultry farms surveyed admitted to feeding antibiotics to chickens from the first day.
The indiscriminate use of antibiotics may be one of the reasons behind growing resistance to drugs.
A study by the World Health Organisation or WHO conducted in 114 countries revealed that "antimicrobial resistance, including antibiotic resistance, is a real threat".
"Without urgent, coordinated action by many stakeholders, the world is headed for a post antibiotic era in which common infections and minor injuries which have been treatable for decades can once again kill," says the report.
In India, cases of drug resistant TB have increased by five times, between 2011 and 2013.
It illustrates the need to regulate the poultry industry, which is growing at an estimated 10 per cent per year.