Thanks for your replies.
Here is the information you need...and the output of other commands which I think may throw some more light...
I have not connected the computers via DHCP..Its a local LAN and the values have been set by me..
output of ip addr command
1: lo: <LOOPBACK,UP,LOWER_UP> mtu 16436 qdisc noqueue state UNKNOWN
link/loopback 00:00:00:00:00:00 brd 00:00:00:00:00:00
inet 127.0.0.1/8 scope host lo
inet6 ::1/128 scope host
valid_lft forever preferred_lft forever
2: eth0: <BROADCAST,MULTICAST,UP,LOWER_UP> mtu 1500 qdisc pfifo_fast state UNKNOWN qlen 1000
link/ether e0:cb:4e:28:61:e8 brd ff:ff:ff:ff:ff:ff
inet 192.168.1.16/24 brd 192.168.1.255 scope global eth0
inet6 fe80::e2cb:4eff:fe28:61e8/64 scope link
valid_lft forever preferred_lft forever
output of dmesg |tail command
[ 55.615330] ip6_tables: (C) 2000-2006 Netfilter Core Team
[ 56.407047] r8169 0000:03:00.0: eth0: link up
[ 56.571400] RPC: Registered udp transport module.
[ 56.571402] RPC: Registered tcp transport module.
[ 56.571404] RPC: Registered tcp NFSv4.1 backchannel transport module.
[ 56.578045] SELinux: initialized (dev rpc_pipefs, type rpc_pipefs), uses genfs_contexts
[ 66.634009] eth0: no IPv6 routers present
[ 135.894544] fuse init (API version 7.14)
[ 135.909457] SELinux: initialized (dev fusectl, type fusectl), uses genfs_contexts
[ 135.928829] SELinux: initialized (dev fuse, type fuse), uses genfs_contexts
output of ifconfig -a command
eth0 Link encap:Ethernet HWaddr E0

B:4E:28:61:E8
inet addr:192.168.1.16 Bcast:192.168.1.255 Mask:255.255.255.0
inet6 addr: fe80::e2cb:4eff:fe28:61e8/64 Scope:Link
UP BROADCAST RUNNING MULTICAST MTU:1500 Metric:1
RX packets:0 errors:0 dropped:0 overruns:0 frame:0
TX packets:24 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:1000
RX bytes:0 (0.0 b) TX bytes:4442 (4.3 KiB)
Interrupt:44 Base address:0x2000
lo Link encap:Local Loopback
inet addr:127.0.0.1 Mask:255.0.0.0
inet6 addr: ::1/128 Scope:Host
UP LOOPBACK RUNNING MTU:16436 Metric:1
RX packets:47 errors:0 dropped:0 overruns:0 frame:0
TX packets:47 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:0
RX bytes:3785 (3.6 KiB) TX bytes:3785 (3.6 KiB)
output of iptables -L -n command
Chain INPUT (policy ACCEPT)
target prot opt source destination
ACCEPT all -- 0.0.0.0/0 0.0.0.0/0 state RELATED,ESTABLISHED
ACCEPT icmp -- 0.0.0.0/0 0.0.0.0/0
ACCEPT all -- 0.0.0.0/0 0.0.0.0/0
ACCEPT tcp -- 0.0.0.0/0 0.0.0.0/0 state NEW tcp dpt:22
REJECT all -- 0.0.0.0/0 0.0.0.0/0 reject-with icmp-host-prohibited
Chain FORWARD (policy ACCEPT)
target prot opt source destination
REJECT all -- 0.0.0.0/0 0.0.0.0/0 reject-with icmp-host-prohibited
Chain OUTPUT (policy ACCEPT)
target prot opt source destination