The raids began at 7.30 am and went on till late evening, an I-T official said, adding the exercise would continue tomorrow.
"We suspect tax evasion on brand endorsements, offshore assignments and private appearances," the official said.
The raids were conducted at Katrina's residence on the seventh floor of Guldev Sagar building in suburban Bandra and Priyanka's apartment on the eighth floor of Raj Classique building at Yari Road in suburban Versova.
The residence of Priyanka's father, Ashok Chopra, in suburban Lokhandwala, was also raided besides the premises of the actor's secretary Chand Mishra, the officer said.
In a related development, searches were also conducted on the premises of well-known Bollywood photographer Atul Kasbekar and his talent management company Bling.
"We searched Matrix talent management company owned by one Reshma Shetty as its manager Sandhya was also the manager of Katrina. Besides, raids were conducted on Kasbekar's premises as he formerly owned this company," the official said.
The I-T officer said 12 premises were raided. However, he refused to quantify the suspected tax evasion by the two top Bollywood stars.
"We would be able to ascertain how much tax they evaded only after the search operation is complete and documents are scrutinised.
"After the raids are over, we will compile the details and send them to the department's assessment wing who would then initiate further proceedings," the official said.
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