Police denied earlier reports that explosion of a gas cylinder caused the mishap at Hotel Kinara in Kurla (W) at around 1 p.m.
"Short circuit appears to be the cause behind the incident...There was no explosion," said DCP (Detection) Dhananjay Kulkarni.
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"Bodies were sent to Rajawadi hospital in Ghatkopar (E)," said DCP (Zone V) Mahesh Patil.
Meanwhile, parents of the missing students have reached the hospital.
The police as well as fire brigade are probing the case.
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