Doubt with blocks & procs

problem.rb

def foo
  p = block_given? ? Proc.new : nil
end

obj = foo{ |x| x + 1}
obj.call(3)
#=> 4

#How does this work? `Proc.new` in definition must have had the block as argument to give resulting Proc object. 
#How does passed block to `foo` get passed in `Proc.new` ?

p = Proc.new
#ArgumentError: tried to create Proc object without a block