Madras High Court Directs State To Constitute District-Level SITs To Probe Fraudulent Insurance Claims

Justice GK Ilanthiraiyan has directed the State and DGP to ensure that the SIT is constituted in every district and functions in strict compliance with the court's directions. The court added that the SIT can also initiate appropriate criminal proceedings against the persons involved in making fake insurance claims.

“The first and second respondents are directed to constitute a Special Investigation Team at the district level in every district of the State and necessary financial and administrative support for conducting a comprehensive investigation into fraudulent insurance claims involving fake accidents, misrepresentation of facts, forged insurance policies, fabricated injuries, and false medical reports and bills and to initiate appropriate criminal proceedings against the persons responsible,” the court said.

The court added that the SIT shall be headed by the Deputy Superintendent of Police, District Crime Branch in the districts and by the Assistant Commissioner of Police, City Crime Branch in the Commissionerates. The court added that the SIT's functioning will be monitored, supervised, and periodically reviewed by the concerned Superintendent of Police, District Crime Branch in respective zones, under the overall guidance and supervision of the Additional Director General of Police, CBCID, Chennai.

The court said that the SIT shall have jurisdiction to receive, enquire, investigate complaints relating to fraudulent insurance claims, including fake motor vehicle accidents, fabricated insurance policies, false claims of injuries, forged medical records and bills, and all other connected fraudulent activities.

The court added that when the SIT receives a request from an insurance company for probing a claim, it shall process such request in accordance with law and facilitate the collection of materials, including call details.

The court directed the Heads of Departments to initiate appropriate departmental action against officials found responsible for any dereliction of duty or misconduct in facilitating or failing to prevent such fraudulent claims. The court added that criminal proceedings could also be initiated against such officers, whenever warranted in law.

The court passed the directions in a plea filed by Go Digit General Insurance Company, seeking constitution of an SIT in district level and for providing necessary financial and administrative support to investigate into fake insurance claims.

The petitioner submitted that the Supreme Court, in Safiq Ahmad Vs. ICICI Lombard Insurance Company Co Ltd., and others, had directed the respective State Governments to form SIT to enquire into cases of fake claims It was argued that this direction had not been effectively implemented by the concerned authorities.

The Assistant Inspector General of Police filed a status report submitting that the proposal to constitute SIT headed by an officer not below the rank of Additional Director General of Police was not practically feasible. It was submitted that the ADGP was already supervising investigation into TN Protection of Interest of Depositors Act and other special enactments. Thus, it was submitted that there was administrative and logistic constraints.

Taking note of the large volume of cases requiring investigation and the shortage of manpower, the court suggested that in urban areas, the investigation can be taken up by Assistant Commissioner of Police attached to City Crime Branch and in rural areas, by the Deputy Superintendents of Police attached to the District Crime Branches.

The court thus issued the directions for constitution of SIT. With respect to specific cases pointed out by the petitioner insurance company, the court noted that the Investigating Officers in the cases could furnish the call detail records of the drivers in the vehicles concerned within 2 weeks.

Counsel for Petitioner: Mr. N. Shylappa Kalyan

Counsel for Respondents: Mr. R. Ganesh Kumar, Counsel for Government of Tamilnadu (Crl.Side)

Case Title: Go Digit General Insurance Company Ltd v The State of Tamil Nadu and Others

Citation: 2026 LiveLaw (Mad) 375

Case No: WP Crl No. 1334 of 2025