1. In an application for reference under Sec.256(1) of the I.T. Act, 1961 (hereinafter to be referred to as "the Act"), the Income-tax Appellate Tribunal, Patna Bench A, has submitted the statement of case and referred the following question of law for the opinion of this court:

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the quantum of penalty imposable in this case was to be governed by the law which was in force on the first day of the assessment year and not the amended law which came into effect from April 1, 1968?"

2. The facts are absolutely beyond controversy. Shortly speaking, the statement of the case submitted to this court represents a full statement of facts which are in respect of the assessment year 1967-68. The assessee filed a return showing an income of Rs. 2,477. The assessment was made on an income of Rs. 22,844 but this was ultimately reduced to Rs. 15,525 in appeal. A copy of the assessment order passed by the ITO has been marked annex. A and forms part of the statement of case.

3. The main additions made in this case were in respect of the cash credit of Rs. 4,676 and disallowance of personal