Aljazeera’s Afghanistan correspondent said a US officer was “100% sure” Taliban leaders Mulla Umar and Mulla Qahar were both surrounded in the village of Sarsang with about 1000 Taliban fighters.
The special forces have joined a major week-long operation against suspected Taliban and al-Qaeda bases in the mountains of Daychopan district of Zabul province, 300 kilometres southwest of Kabul.
Our correspondent counted at least six Chinook helicopters transporting men and equipment into the mountains.
Aljazeera.net has learned the Afghan government infantry was ordered to withdraw in anticipation of a huge aerial attack on Sunday night.
But B52 bombing proved inaccurate and Afghan troops reported seeing “piles of dead civilian men, women and children."
At least one US soldier also died on Monday when his parachute failed to open.
One Afghan field commander, Sayf Allah, said Taliban troops had unexpectedly mounted an attack behind US and Afghan army lines, killing at least eight Afghan soldiers and slightly wounding General Sayf Allah himself.
Sayf Allah confirmed that no Taliban had been captured alive so far, but they had almost certainly suffered casualties.
However, the Afghan Islamic Press (AIP) reports that the interim Afghan President, Hamid Karzai, has begun negotiations with Taliban officials in several parts of the southeastern province.
Mulla Umar has been on the run
for two years
The negotiations are being conducted by senior government officials, Abd al-Rahman Hotak and provincial governor Hafiz Allah, the Pakistan-based AIP private news service said.
"We have started negotiations because the Karzai government believes in resolving problems through peaceful dialogue," Hotak was quoted as telling the AIP. Hotak made no reference to the current military bombings and deployments.
Taliban back broken
The clashes came even as a Pakistani official claimed that the Taliban was a spent force and that rumours of a reorganisation in his country were baseless.
Foreign office spokesman Masud Khan told a press briefing on Monday the governments assessment was that only Taliban "splinter groups" remained, and that Islamabad was making sure they were not allowed to regroup.
Afghan officials had recently claimed Taliban loyalists were regrouping on the Pakistani side of the porous 2400km border and organising attacks inside Afghanistan.
Khan said the issue came under discussion when Foreign Minister, Khurshid Mahmud Kasuri, visited Kabul last month and held detailed talks with Afghan Foreign Minister, Abd Allah Abd Allah.
"The general sense was that the right thing to do was to share intellignece and information," Khan added.