IndiGo Flight 6E-237 from Ahmedabad was involved in the incident that happened on February 27.
Sources said the A-320 aircraft was few minutes away from touch down at Jaipur airport when a warning from Enhanced Ground Proximity Warning System was noticed.
The pilots seem to have mistaken the road nearby as the runway and soon after the warning, the flight made a go-around and managed to land safely at the Jaipur airport, they added.
Installed in an aircraft, Ground Proximity Warning System provides a timely warning to the flight crew when the aeroplane is in potentially hazardous proximity to the earth's surface.
The directorate general of civil aviation is investigating the matter and taking serious note of the violation, the regulator has suspended the flying licenses of two pilots, the sources said.
Soon after the incident, the airline had grounded the pilots from flight duties.
IndiGo operates 180-seater planes.
When contacted, IndiGo said the flight 6E-237 was involved in "EGPWS Too Low Terrain" warning during visual approach at runway 27 at Jaipur airport.
"The captain-in-command immediately took a precautionary measure and carried a go-around. The aircraft landed safely on subsequent instrument landing system approach on runway 27," it said in a statement.
IndiGo said both the pilots have been taken off from flight duty with immediate effect.
"The matter was duly reported to the DGCA by IndiGo flight safety department," it added.
Earlier this month, a New Delhi-bound IndiGo flight from Vadodara with 177 passengers on board made an emergency landing at the city airport due to a technical fault.
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