"A Coast Guard boat based at Dahanu and a helicopter from Daman was launched immediately for rescue", it said.
According to some reports, around 4 school children are reportedly dead while some media reports say that no school children have died, but 32 are missing and 8 are missing.
Coast guard PRO said ships which were at sea have been diverted to the site of mishap and ships are also sailing from Mumbai.
The police have said the owner of the boat along with three others, whose identities are yet to be revealed, was arrested on the evening of January 13.
A massive search is underway to find any remaining unaccounted student amidst fears of casualty figures increasing in the incident that took place around 5 kms in the sea off the Parnaka Beach here.
On Saturday, around 11.30 am, the students had reached the beach and boarded the boat after some time. Even the local fishermen got their boats for the rescue operations.
The bodies of the two students recovered have been identified as Sonal Surti and Jahnvi Surti, both 17, from Ambedkar Nagar area of Dahanu, the official said. "They were all thrilled when the boat went into the water and climbed up on to the deck and began taking pictures and selfies", said a police officer, investigating the case.
"Anguished to hear of boat carrying school children capsizing in Dahanu, Maharashtra". Sources said the boat lost balance when several students shifted to one side.
President Ram Nath Kovind, who arrived in Mumbai on Saturday on a two-day visit to Maharashtra, offered his condolences to the families of those killed in the tragedy.