"A rescue operation has been under way ... however, due to heavy rains and heavy winds, the helicopters were unable to get in there to save those they saw were still alive."
He said at least 200 homes were believed to have been buried.
"Single-storey houses have been covered in mudslides," Richard Hu, an army major-general, said.
"We don't know how many people are there, but homes have definitely been buried."
At least 23 people were killed and scores more missing in other areas across Taiwan.
Taiwan's Disaster Relief Centre said a woman was killed when her vehicle plunged into a ditch in Kaohsiung county in heavy rain a day ahead of the storm's arrival, and two men drowned in Pingtung and Tainan.
"A lot of the roads have been washed out ... some buildings are half submerged, and we're seeing a lot of fowl and livestock floating in the water, obviously drowned from the heavy flooding," Chao said.
The military was also trying to rescue thousands of people cut off by fallen bridges and raging rivers after the typhoon dumped a record three metres of rain on the island.
Armoured vehicles and marine landing craft were mobilised in a rescue operation involving at least 1,600 troops, Taiwan's defence ministry said.
Morakot, which means "emerald" in Thai, earlier lashed the Philippines, killing at least 21 people.