The SIT - headquartered in Aurangabad - will be headed by water management expert Madhav Chitale with three other retired bureaucrats as members. It has been given a six-month deadline to submit its report.
The other SIT members are former additional chief secretary (finance) AKD Jadhav, former irrigation secretary VM Ranade and former agriculture commissioner Krishna Lavekar.
The development follows an assurance by the government in the state assembly December 17 that a SIT would probe the alleged scams in the irrigation department.
Nationalist Congress Party strongman and deputy chief minister Ajit Pawar had quit the cabinet in September after allegations of irregularities in the department which he had headed for nearly a decade.
However, after the state government issued a White Paper claiming a 5.17% increase in irrigated areas, Pawar bounced back as deputy chief minister last month.
The SIT has been given nine terms of references covering the entire gamut of state irrigation in its probe.
These include reasons for lesser irrigated areas, project cost escalation, delay in implementation and execution of projects, whether administrative procedures were followed while approving cost escalation, fixing responsibility for these lapses and suggesting appropriate action against officials, measures to increase irrigated areas and ensure time-and-cost bound implementation of projects.