The commanding Officer of INS Sindhuratna will face court martial while 6 other officers were issued letters of "severe displeasure" after being found guilty for the fire onboard the submarine last year, which led to the resignation of then Navy chief Admiral D K Joshi.
Navy sources said the recommendations of the Board of Inquiry has been accepted by the Naval Headquarters.
"The Commanding Officer of INS Sindhuratana has been recommended for General Court Martial. 6 other officers have been awarded Letters of Severe Displeasure," the sources said.
They said Commander Sandeep Sinha will face court martial proceedings by the Western Naval Command and will get an opportunity to defend himself.
Explaining what the 'Letter of Severe Displeasure' meant, the sources said the 6 officers will not get any promotion, study courses or foreign posting for the next two years.
On February 26 last year, a fire broke out onboard INS Sindhuratna when it was at sea off Mumbai for routine training and inspection.
The then Navy chief Joshi resigned the same day, taking "moral responsibility" over a spate of mishaps involving naval assets.
Defence Minister Manohar Parrikar had told Parliament in November that disciplinary action against these officers has been initiated at the Western Naval Command headquarters.
Navy sources said the court martial proceeding will begin soon and the officer will be given every opportunity to defend himself.
Two sailors died and seven members of the 94-strong crew were evacuated after inhaling smoke aboard the diesel-powered submarine following a fire.
A board of inquiry, in its preliminary report, said the fire in some cables led to the smoke in the third compartment.
The Commading Officer was himself hospitalised after he reportedly jumped into the compartment to try and save 2 juniors.
It is said that despite taking in the gases, Sinha had manned the controls personally and brought the submarine up to the surface.
Image: INS Sindhuratna docked at the naval base in Mumbai Photograph: Sahil Salvi