Mumbai: Fire has erupted in the first floor Banquet House of Taj Hotel after an explosion.
Earlier, an AFP correspondent and three other people have been injured in crossfire at the Taj Hotel.
Firing is on at the hotel as the commando operation to secure the hotel enters the final stage.
There are reports of firing at the Nariman House, too, the other location where commandos are engaged in a fierce encounter with groups of heavily armed terrorists.
National Security Guard Director General Jyoti Krishan Dutt said that the operation at the two locations will get over as soon as the terrorists are neutralised.
"The operation has been done in a professional manner. Many hostages fell to the bullets and bodies are being recovered. Some were found in rooms and some in corridors," Dutt said.
"The terrorists have been moving from one place to another and we are trying to corner them," he said.
"Taj Tower has been cleared. At Heritage we are yet to neutralise the terrorists. We will also see if unexploded grenades are lying there," he added.
Speaking about the operation at the Jewish centre of Nariman House, Dutt said that they still had no final input about the number of hostages and added that they want all the hostages to come out safe.
Earlier, a Marine Commandos (Marcos) unit chief said that his team saw 12 to 15 bodies in one room of the Taj Hotel.
"We found 12-15 bodies," the commander with face covered with a black scarf and sunglasses, told a news conference at the Western Naval Headquarters, INS Angre.
"We recovered $1200, AK series rifles, credit cards and Mauritian national identity card from Taj hotel," the commando chief said.
"We found a bag which contained dry fruits, large amount of ammunition, foreign money (dollars), seven fully filled magazines of AK rifles with extra rounds, grenades of different make, most likely made in China, seven credit cards of ICICI, HDFC, CITI Bank, HSBC etc," he revealed.
The commando operation at the Oberoi Hotel got over on Friday afternoon.
Taj Hotel Helplines (Mumbai, India): 91-22-66574322, 66574372, 1800 111 825; Oberoi (Trident) Hotel (New Delhi, India): 91-11-23890606; Ministry of External Affairs control room (New Delhi): 91-11-23015300, 23012113, 23013537. Fax number (New Delhi, India): 91-11-23018158.