In 1861, a new Province viz. Central Province was carved out comprising. Nagpur Province, Sagar & Nurbada Territories along with certain other tracts with the capital at Nagpur. In 1860 Indian Penal Code and Criminal Procedure Code were enacted and the police were given powers to arrest any person without magisterial order or warrant, though there were checks of the magistrates and superior officers. Prichard and Cox and others were critical of one of the clauses of Penal Code, which enabled a magistrate or a police officer, to enter the name of a person in a list of bad characters. They observed that in point of practice, it was not difficult for a native who had a grudge against his neighbor to get his name entered in this list. 'A refusal to lend a policeman money, or a determination of a man to keep his wife to himself, will not improbably result in the money lender's or the husband's name going down in the book of bad characters'.
The revolt of 1857 had shown that Indian military could not be completely relied upon for the protection of British Empire. Further, the military could be concentrated only in a few centers and at best, be used to curb rebellions. The need was felt to develop a sense of fear of authority in the entire country. For this purpose a new country wide police system was considered essential to serve as the first line of internal defense. The Indian Police Act of 1861 came into existence as per the recommendations of the first Police Commission of Sir Napier. He postulated, 'Soldiers are instituted to fight declared enemies, not to be watchers and punishers of criminals. They should be, in thought and reality, identified with their country's glory -- the proudest of their sons - and never employed to enforce at the behest of civil administration, until the civil power is found too weak...'
The reorganization of police in the province led to a huge savings. The irregular force was disbanded while some men were adjusted in the police force. Reorganized Police consisted of 1 Inspector General (IGP), 2 DIGs, 12 Superintendents of Police (SPs), 7 Asst. SPs, 10 Probationary officers, 45 Inspectors, 6284 foot constable and 613 mounted constables, totaling 6974 men of all ranks for the province. Population of the province was above 83 lakhs with an area of 1,11.800 Sq. miles, i.e. there was one police for 1191 inhabitants and to every 5 Sq. miles. Considerations of economy were given more importance than efficiency. There was a stringent control over expenditure on police force; even payment of daily allowance of two annas to police constables for escorting treasure or traveling on duty had to be sanctioned by the Chief Commissioners. It was in 1898 that the IGP wrote to the Chief Commissioner for delegating this power to him.
The Act had provided for Municipal Police. As per the recommendation of Police Commission, every city and town should pay for its own police. In C.P. there were 57 cities and towns which maintained Municipal Police without any aid from the regular establishment. They were paid from the local funds of municipal taxes, town duties and house tax. In Nagpur, Municipal Committee was established in 1864, but it did not have any say in the administration of police. Lord Ripon's Resolution on Local Self Government in 1883, spared the Municipal Committees and local bodies from financing the Police organization. Police now became the charge on Provincial Government's Treasury. Till now, the character of the police was described as Burkandazee Police, but hereafter great care was taken in proper recruitment and training. (The word Burkandaz is Persian, meaning gendarme). This word had fallen into disuse in Persia, but continued in India though a very small number of arms were entrusted to police and were found in effective even for escorting treasure and quelling disturbances. When conservancy services were started in Nagpur in 1873-74, its supervision work was entrusted to the City Police. This arrangement could not succeed for various reasons and therefore the work was entrusted to a DSP who organized sufficient propaganda to spread awareness amongst the public. The work was taken over by the Municipal Committee when they established their own Conservancy Department.