The Indian government had ordered the elephant, named Sunder, returned to the wild after McCartney highlighted the animal's plight during a 2012 trip to India.
Instead, a local politician took Sunder home and shackled him outside a poultry shed, People for the Ethical Treatment of Animals said. The group also released a video that it says shows Sunder in December, writhing in pain and struggling to stand as a handler strikes him with a pole.
The local politician, Vinay Kore, could not be reached for comment. But Tara, one of Kore's household servants who goes by one name, confirmed Sunder stays outside the residence.
"The elephant is kept at the poultry shed and is healthy and fine," Tara said by telephone Friday.
Manilal Valliyate, PETA's director of veterinary affairs in India, said domestically kept elephants face a grim existence in India. Many Hindu temples keep elephants outside their doors to give blessings to visitors, but the animals are often poorly treated.
"The way elephants are kept and treated here in India violates almost all norms," he said. "Sunder is just one example."
McCartney was moved by the poor treatment of Sunder—which means beautiful in Hindi—outside Jyotiba Temple in Kolhapur, about 380 kilometers (240 miles) south of Mumbai.
"I have seen photographs of young Sunder, the elephant kept alone in a shed at Jyotiba Temple and put in chains with spikes," McCartney wrote. "... I appeal to you to do what is right here and get Sunder post-haste to rehabilitation in the forest."
A spokesman for McCartney did not immediately return a call for comment. The former Beatle has been a longtime supporter of PETA.