The seven sailors had to be airlifted to a hospital after they inhaled smoke.
An upset Defence Ministry sought a detailed report from the Navy on the mishap, which is the 10th involving an Indian Navy warship and the third submarine mishap in the last seven month after the sinking of INS Sindhurakshak in August in which all 18 personnel on board were killed.
"Indian Naval Submarine Sindhuratna was at sea off Mumbai for routine training and workup (inspection). While at sea in the early hours of today, smoke was reported in the sailors' accommodation, in compartment number three, by the submarine," the Navy said in a press release.
"We immediately activated our emergency firefighting exercise and seven personnel who had inhaled smoke were airlifted to a hospital. Two officials are unaccounted for. They might have been left in the cabin or at some other place as various cabins and compartments are isolated as part of the emergency measures," the officers said.
The injured has been admitted to the naval hospital INS Ashwini after they were airlifted by Seaking multirole helicopters in multiple sorties.