^I is probably not indicating a caret followed by an I, but rather is a representation of the character composed by pressing Ctrl+I. This character actually has a shortcut on most keyboards, to wit Tab. If you were to
cat the file, you would probably see something like:
Unless, that is, whatever you're using that is displaying literal
^Is is also showing the end of the line with a visible
You can use
tr to eliminate them if you like, though:
$ cat file | tr -d '\t'
\t in this case is a magic sequence that is an easy way to represent a Tab character in several common tools (including, helpfully,
dos2unix did nothing to the Tabs because they are identical between all the platforms that tool is used to "translate" to and from.