When Italian prisoners were questioned after they were captured, they told the Australians that they had expected to be supported by German tanks from the 5th Armored Regiment, but the German tanks did not appear. A German officer was attached to the attacking force to coordinate operations. Rommel apparently had ordered the armored battalion from the Ariete division to support the attacking infantry. The infantry pushed to the top of Hill 187 and stopped. They were shelled and then retreated to a wadi. The German staff officer described the Italian retreat as a "rout". He had several anti-tank guns and fired on a scout car and shot at Bren carriers. Afterwards, a senior Italian prisoner helped draft a flyer to be distributed to Italian troops the next day, encouraging then to surrender.
General Wavell, as out of touch as usual, sent a message urging an attack against the Germans at Salum. General Morshead declined to mount such an attack, as he was more concerned about defending the long perimeter at Tobruk.
important reinforcements arrived by ship on 16 April 1941. They were 12 infantry tanks manned by a squadron of the 7th Royal Tank Regiment. I think that the correct name of the unit is the 7th Battalion of the Royal Tank Regiment, although the name given is what they were ultimately called.
Overnight on 16-17 April 1941, the enemy guns heavily shelled the Australians. That seemed to indicate another attack on the 17th. General Morshead ordered the 2/1st Pioneer Battalion to act as infantry in his reserve force. The pioneers had been engaged in constructing a second line of defense.
An attack was launched as expected. It fell on the 2/48th Battalion in the west. The enemy infantry had been mounted on vehicles, but they got off and attacked on foot. The attack had some tank support. The tanks seemed to have been mostly Italian light tanks. By about 1pm, the tanks broke through the wire. The tanks had been there to support infantry, but the infantry attack failed under heavy British artillery fire. Anti-tank guns fired on the tanks, which then drove into the reserve company. Seven British cruiser tanks arrived and knocked out some of the Italians. The tank attack then had failed and only one tank escaped back through the wire. The defenders had knocked out five tanks, one of which was a medium tank (M13/40?).
More tanks and infantry hesitated to attack and stayed just outside the wire. Later in the evening, cruiser tanks from the 1st RTR, fought some 12 enemy tanks in the south. They knocked out three tanks with no loss to themselves. This is based on the account in Vol.III of the Australian Official History.