Summarize the following court judgment. ivil Appeal No. 424 of 1963. Appeal by special leave from the judgment and order dated April 8	 1960 of the Allahabad High Court in Civil Misc. Writ No. 2650 of 1956. C.B. Agarwala and O.P. Rana	 for the appellant. Yogeshwar Prasad	 Harder Singh and M.V. Goswami	 for the respondents. The Judgment of the Court was delivered by Raghubar Dayal	 J. This appeal	 by special leave	 raises the question whether Zamindari Abolition Compensation Bonds (shortly termed Bonds) issued by the U.P. Government to intermediaries in payment of compensation payable on the basis of their rights under the Uttar Pradesh Zamindari Abolition and Land Reforms Act	 1950 (U.P. Act I of 1951)	 hereinafter referred to as the Act	 have to be accepted by the appropriate authorities in payment of the agricultural income tax due from them. 131 The facts leading to the appeal	 in brief	 are that the respondent	 an ex Zamindar	 was assessed to agricultural income tax in the assessment year 1360 F corresponding to 1952 53	 on the basis of the agricultural income accruing in the previous year 1359 F corresponding to 1951 52. He did not pay the assessed tax and was further assessed to a penalty. In the result	 Rs. 868/ were to be paid by him for tax plus penalty. The respondent 's writ petition contending that he was not liable to pay tax was dismissed by the High Court. Thereafter	 the agricultural income tax authorities took out proceedings for the realisation of the amount due from him. On July 24	 1956	 the respondent presented an application to the Agricultural Income tax Assessing Officer	 Allahabad	 stating that he had no ready cash to pay the dues and that he was therefore depositing Bonds of the value of Rs. 850/ and Rs. 18/ in cash and praying that the Bonds be accepted in payment of tax dues. This application was rejected by an order stating that there was no rule for the acceptance of those bonds and that they be returned to the applicant. On August 1	 1956	 the respondent made a similar application to the Collector complaining that the Assessing Officer had no valid reason to refuse to take the Bonds when the Bonds were negotiable instruments. This application was also rejected on a report of the Assessing Officer that the Bonds were not accepted in the settlement of agricultural income tax dues	 that they were not negotiable and that there was no provision in the Act for their acceptance. Thereafter	 the respondent presented a writ petition to the High Court of Allahabad praying for the issue of a writ of certiorari quashing the orders of the Assessing Officer and the Collector	 Allahabad	 for the issue of a writ of mandamus directing them to accept the Bonds in lieu of the tax dues and	 in any case	 to deduct the amount from the rehabilitation grant due to the petitioner and for the issue of a writ of prohibition directing the opposite parties from adopting coercive measures for the realisation of the tax due from the petitioner. The grounds mentioned in support of the prayers were that the Bonds were negotiable instruments and therefore refusal to accept them in payment of agricultural income tax was illegal	 that they	 having been issued by Government	 could not be subsequently refused they being perfectly valid legal tender and that in view or r. 8A of the Rules made under the Act the amount due for tax should have been deducted from the interim compensation. The counter affidavit filed by the Naib Tehsildar Agriculture Income tax Officer	 Allahabad	 on behalf of the State	 stated that the respondent was assessed to agricultural income tax in the assessment year commencing from July 1	 1952 on the income derived in the previous year commencing from July 1	 1951	 that the tax 132 had to be paid in four instalments and in default of payment a penality of Rs. 43/ was imposed for each default in payment of the four instalments and that the Bonds could not be accepted towards the tax due under section 6(d) of the Act read with r. 48 of the Rules as the tax had fallen due in 1360 F	 corresponding to July 1	 1952 to June 30	 1953. The High Court held that the orders of the Agricultural Income tax Assessing Officer and the Collector were wrong as the ground for refusing to accept the Bonds in payment of the tax on the ground that there was no rule or statutory provision for their acceptance was incorrect and appeared to have been given in complete ignorance of the provision of law. Reference was made to the provisions of section 6(d) of the Act and r. 8A. The High Court was of the opinion that these have been completely ignored by the two officers. It	 therefore thought that the orders were liable to be quashed and that adequate relief would be available to the respondent if a direction was given to the Collector to decide his application dated August I	 1956	 in accordance with law. The High Court therefore quashed the order of the Collector dated August 24	 1956 and directed him to decide the respondent 's application afresh in accordance with law as indicated above. The appellant thereafter obtained special leave from this Court and appealed against the order of the High Court dated April 8	 1960. The main contention for the appellant before us is that neither section 6(d) of the Act nor r. 8A provides that Bonds can be accepted in payment of agricultural income:tax and that therefore the order of the Collector dated August 24	 1956 was correct. For the respondent it is urged that r. 8A makes it mandatory for the Agricultural Income tax Officer to realise the agricultural income tax due from the compensation payable and that compensation continues to be payable till the Bonds are actually encashed	 Section 6(d) of the Act	 as originally enacted	 did not provide	 among the consequences of the vesting of the estate in the State	 that arrears on account of agricultural income tax might be realised by deducting the amount from the compensation money payable to the intermediary under Chapter III. An amendment was made in this clause (d) by section 3 of U.P. Act XVI of 1953	 with retrospective effect from July 1	 1952. and the relevant portion of the provision after amendment reads thus: "All arrears of revenue	 . or an arrear on account of tax on agricultural income assessed under the U.P. Agricultural Income tax	 Act	 1948 for any period prior to the date of vesting shall continue to be recoverable from such intermediary and may	 without prejudice to any other mode of recovery be realised by deducting the amount from the compensation money payable to such intermediary under Chapter III;" 133 Rule 8A was added to the rules by Notification No. 3266/I A 1056 1954 dated August 17	 1954 and its relevant portions read: "8 A. Without prejudice to the right of the State Government to recover the dues mentioned below by such other means	 as may be open to it under law: (1) all arrears of land revenue in respect of the estates which have vested in the State Government as a result of the notification under Section 4 of the Uttar Pradesh Zamindari Abolition and Land Reforms Act	 1950 (Act 1 of 1951)	 and of tax on agricultural income assessed under the U.P. Agricultural Income tax Act	 1948 (U.P. Act III of 1949) due from an intermediary for any period prior to the date of vesting shall be realised: (a) in the case of an intermediary who was assessed to land revenue of Rs. 10	000 or more from the amount of interim compensation due to him	 and (b) in the case of an intermediary who was assessed to a land revenue of less than Rs. 10	000 per annum by deduction from the amount of compensation payable to It is clear from the above provisions that neither section 6(d) nor r. 8A provide that Bonds must or can be accepted in payment of tax on agricultural income. It has been held by this Court in Collector of Sultanpur v Raja Jagdish Prasad Sahi(1) that the provisions of section 6(d) of the Act would apply to arrears on account of agricultural income tax assessed in 1360F on the basis of agricultural income during the year 1359F and that the provisions of r. 8A are mandatory. It is not urged for the appellant that r. 8A is inconsistent with the provisions of section 6(d) which provides that arrears of tax may be realised from the compensation payable and therefore appears to give a discretion to. the authorities to realise the arrears of tax from the compensation payable. We do not agree with the contention for the respondent that the compensation payable to the intermediary continues to remain payable even after the compensation Bond 's had been delivered to him. Section 68 of the Act provides that the compensation under the Act shall be payable in cash or in bonds or partly in cash and partly in bonds as may be prescribed. It is clear therefore that the delivery of Bonds to the intermediary is in payment of the compensation. The claim for compensation is thus satisfied when the compensation has been paid in accordance with the provisions of section 68. This is also clear from the relevant rules for the payment of compensation. (1) 134 Rule 62 as it stood prior to November 29	 1956	 provided that the compensation would be paid in negotiable bonds which would be described as Zamindari Abolition Compensation Bonds. Rule 63 as it then stood provided that the Bonds would be issued in specified denominations and would bear interest at the specified rate on the principal that had become payable calculated from the date of vesting. Rule 64 provided that interest together with the principal of a Bond would be paid in equated annual installments except for the last	 as described in Appendix IV during the period of 40 years beginning from the date of vesting	 provided that any Bond might be redeemed at an earlier date at the option of the Government. Rule 65 provided that the instalments due on a Bond from the date of its effacement would be payable on presentation from and after July 1st next after the delivery of the Bond to the intermediary. These rules show that the compensation does not remain payable alter the delivery of the Bonds and that the Bonds could not be cashed before the due date for their encashment. The fact that the Bonds are negotiable does not make them legal tender and does not make it obligatory on anyone	 including Government	 to accept them in payment of any dues. The only result of their being treated as negotiable instruments is that the owner of the Bends can transfer them to any person who is agreeable to purchase them. When the compensation payable to an intermediary has been paid in the form of cash or Bonds	 that compensation ceases to be payable. Section 6(d) of the Act and r. 8A of the rules do not. as already stated	 provide for the receipt of agricultural income tax in the form of Bonds. We are therefore of opinion that the Collector cannot be said be in error in not accepting the Bonds which had been delivered and which were not even cashable at the time	 in payment of the arrears of agricultural income tax payable under the Agricultural Income tax Act. We accordingly allow the appeal	 set aside the order of the High Court and restore that of the Collector dated August 24	 1956 The respondent will pay the costs of the appeal to the appellants Appeal allowed.

The respondent who was assessed to agricultural income tax made an application to the Assessing Officer depositing compensation Bonds and prayed that the Bonds be accepted in payment of tax dues. This was rejected stating that there was no rule for acceptance of these bonds. Another attempt by the respondent was also turned down by the Collector. Thereafter the respondent presented a writ petition in the High Court for directing them to accept the Bonds in lieu off the tax dues. The High Court was of the opinion that the two officers completely ignored the provisions of section 6(d) of the Act and r. 8A	 and directed the Collector to decide the respondent 's application in accordance with law. In appeal by special leave: HELD: (i) Neither section 6(d) nor r. 8A provide that the Bonds must or can be accepted in payment of tax on agriculture income. [133 E] Collector of Sultanpur vs Raja Jagdish Prasad Sahi. 	 referred to. (ii) When the compensation payable to an intermediary has been paid in the form of cash or Bonds. that compensation ceased to be payable. The fact that the Bonds are negotiable does not make them legal tender and does not make it obligatory on anyone including Government to accept them in payment of any dues. The only result of their being treated as negotiable instruments is that the owner of the Bonds can transfer them to any person who is agreeable to purchase them. [134 D F]