1. This order will dispose of Income-tax Case No. 2 of 1971 and Income-tax Reference No. 30 of 1970.

2. The assessee is Messrs. Gumani Ram Siri Ram of Muktsar, district Ferozepur. In the assessment year 1964-65 while proceeding with the assessment, the Income-tax Officer noticed cash deposits of Rs. 12,000 appearing in the name of Messrs. Romesh Trading Company in the books of the assessee. The assessee was asked to prove the genuineness of these cash credit entries. The assessee stated that he was not in a position to prove the genuineness of these entries and made a statement "surrendering squared up account of Rs. 12,000 in the name of Romesh Trading Company". The assessee was then assessed to an income of Rs. 65,046 as against the returned income of Rs. 46,446. The income assessed included the amount of Rs. 12,000.

3. The assessment was followed by proceedings under Section 271(1)(c) of the Income-tax Act, 1961, and a penalty of Rs. 6,768 at 50 per cent. of the tax sought to be evaded was levied by the Inspecting Assistant Commissioner. Against his decision an appeal was taken to the Income-tax Appellate Tribunal. The Tribunal maintained the order levying the penalty bu