SMOKE FROM INSTRUMENT PANEL WHILE IN TRAFFIC PATTERN LEADS TO EMERGENCY DECLARATION AND LANDING BY C172 INSTRUCTOR AND STUDENT PLTS.

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MY STUDENT AND I WERE DOING A TOUCH-AND-GO FLT FOR LNDG PRACTICE. AFTER 45 MINS OF FLYING IN THE ARPT PATTERN; WE NOTICED SMOKE BEGINNING TO COME FROM BEHIND THE RADIOS/INST PANEL. I IMMEDIATELY DECLARED AN EMER AND WAS CLRED TO LAND ON THE RWY. 1 OR 2 ACFT WERE TOLD TO GO AROUND TO LET ME INSIDE OF THEM. I THEN TURNED OFF THE MASTER SWITCH AND ALL ELECTRICAL COMPONENTS; AND DID A SHORT APCH AND SUCCESSFUL LNDG. UPON CLRING THE RWY; I RECEIVED A GREEN LIGHT GUN SIGNAL AND TAXIED INTO THE RAMP WHERE FIRE TRUCKS CAME AND MET ME. THE SMOKE HAD ALREADY DISSIPATED AFTER WE TURNED OFF ALL ELECTRICAL COMPONENTS; AND THE FIREMEN DETERMINED THERE WAS NO FIRE IN THE ACFT. I BELIEVE THE ACFT PROBABLY HAD A SHORT IN THE PANEL AND BURNED UP SOME WIRES. THE ACFT IS GOING TO BE THOROUGHLY CHKED BY MAINT AND AVIONICS TECHNICIANS BEFORE IT RETURNS TO SVC. THANKS TO QUICK ACTION BY MYSELF; MY STUDENT (WHO NOTICED THE SMOKE AND BACKED ME UP ON THE CHKLIST); AND THE TWR FOR RESPONDING QUICKLY AND APPROPRIATELY; THIS POTENTIALLY DANGEROUS SCENARIO ENDED QUICKLY AND SAFELY.