Wildlife experts say about 40 calves may have been stolen from their herds during a 10-year period and sold for around $125,000 each.
The deputy director of the wildlife conservation department, Upali Pathmasiri, and seven others were charged with 33 counts of capturing and possessing baby elephants in 2014-15, state attorney Nishara Jayaratne said.
It is the "first ever elephant trafficking case in our legal history", Jayaratne told AFP.
If convicted they face up to 20 years in jail.
The practice stopped when the current government came to power in January 2015 and launched a crackdown. Recovered animals were moved to a state sanctuary for elephant orphans.
The super-rich consider having a baby elephant at home as the ultimate status symbol.
It was also a tradition by aristocrats to keep the animals, which are paraded at Buddhist temple festivals.
The illegal trade has been blamed for the drop in the elephant population, with conservationists saying mother elephants were often killed so the calf could be taken.
Elephant conflict with humans near wildlife sanctuaries has led to the deaths of 375 people in the past five years, according to official figures.
During the same period, enraged villagers have retaliated by slaughtering nearly 1,200 elephants.
The Sri Lankan elephant population in the wild is estimated at 7,500.
Conservationists also say that a large number of elephants are killed by improvised explosive devices hidden in bait used by villagers to hunt other animals, especially wild boar.
The devices explode when bitten, causing the animals a prolonged and painful death.
The US-based conservation website Mongabay.com said 64 Sri Lankan elephants were killed.