Nazir Ahmad, J.

1. A statement of the case under Sec.256(1) of the I.T. Act, 1961 (hereinafter referred to as "the Act"), has been submitted by the Income-tax Appellate Tribunal, "A" Bench, Patna, referring 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 correct in law in holding that the order of the Inspecting Assistant Commissioner suffered from a legal infirmity in view of the amended provisions of Sections 274 and 275 of the Income-tax Act, 1961 ?"

2. The relevant facts of the case may be culled out from the statement of the case. The assessee is a firm and the assessment year involved is 1966-67. In the course of the assessment proceedings, the ITO noticed cash credits aggregating to Rs. 23,500 in the names of different persons in the books of accounts of the assessee. In the absence of satisfactory evidence as to the sources of the credits, the ITO included this amount as unexplained income of the assessee and initiated proceedings under Sec.271(l)(c) of the Act. Since the minimum penalty imposable in this case exceeded Rs. 1000, the ITO referred the matter to the IAC.

3. Befor