Summarize the following court judgment. Appeals Nos. 979 and 980 of 1965. Appeals by special leave from the judgment and orders dated November 12	 1962 and January 1	 1964 of the Madras High Court 951 in Tax Case Nos. 19 of 1961 and S.C. Petition No	. 142 of 1963 respectively. section Swaminathan and R. Gopalakrishnan	 for the appellant (in	 both the appeals). P. Ram Reddy and A. V. Rangam	 for the respondent (in both the appeals). The Judgment of the Court was delivered by Shah	 J. section S.Rajalinga Raja hereinafter called 'the appellant ' owns acardamom plantation on a fifty acre estate. For the assessment year 1957 58 he submitted a return under the Madras Plantations Agricultural Income tax Act 5 of 1955 disclosing a net income of Rs. 5	250/ from the plantation. On enquiry the Agricultural Income tax Officer learnt that the appellant had sold stocks of cardamom of the value of Rs. 58	375 9 9 between April 1	 1956 and March 31	 1957. The appellant explained that those sales represented not the produce of the year of account	 but accumulated stocks of the past 3 to 4 years. That explanation was rejected by the Agricultural Income tax Officer and after allowing expenditure estimated at the rate of Rs. 120/ per acre	 the balance was brought to	 tax	 and a penalty of Rs. 3	000/ was levied under section 20(1) (c) of the Act. The order was confirmed in appeal to the Appellate Assistant Commissioner	 both as to the levy of tax and penalty. But the Appellate Tribunal was of the view that the average production of cardamom per acre was 40 lbs. and that if the stocks of cardamom	 sold in the year of assessment be attributed to production of the year	 the yield would approximately be 134 lbs. per acre. Holding that. an estimate of 40 lbs. per acre would be a "fair estimate" and that an average expenditure of Rs. 145/ per acre should be allowed	 the Tribunal directed that the assessment be modified	 and the order imposing penalty be set aside. The State of Madras then applied to the High Court of Madras in revision. The High Court was of the view that a part of the stock of cardamom sold in the year	 though not the whole	 was probably accumulated stock out of previous year 's production	 but since the appellant did not lay before the taxing authorities reliable evidence	 his explanation was rightly rejected. The High Court also rejected the contention of the appellant that the income from sales of ' cardamom stock of previous years was not taxable in the year of ' account because it had been subjected to tax in those previous. years under orders compounding the tax under section 65 of the Act. The High Court accordingly allowed the petition and restored the assessment made by the Department. With special leave	 the 1 appellant has appealed to this Court. It is claimed by the appellant in the first instance that under the Act	 agricultural produce itself is income and becomes charged to	 952 tax under the Madras Plantations Agricultural Income tax Act 1955	 when it is received	 and not when it is sold	 used or consumed. Relying upon this premise it was urged that even on the view expressed by them the learned Judges of the High Court ought to have directed determination of the produce which was actually derived from agriculture in the year of. account	 and ought to have brought to tax only that quantity and excluded the value of the rest from taxation under the Act. Section 3 of the Act imposes the charge of tax upon the total agricultural income of the previous year of every person	 and by section 4 the total agricultural income of any previous year of any person comprises all agricultural income derived from a plantation within the State and received within or without the State. 'Agricultural income ' is defined (insofar as the definition is relevant in these appeals) as meaning: "(1) any rent or revenue derived from a plantation; (2) any in 	am 	 derived from such plantation in the State :by (i) agriculture; o (ii) the performance by a cultivator or receiver of rent in kind of any process ordinarily employed by a cultivator or receiver of rent in kind to render the produce raised or received by him fit to be taken to market; or (iii) the sale by a cultivator or receiver of rent in kind of the produce raised or received by him	 in respect of which no process has been performed other than a process of the nature described in paragraph (ii): Explanation 1. Explanation 2. (3) Prima facie	 section 3 of the Act read with the definition of 'agricultural income ' charges to tax the monetary return either as rent or revenue or agricultural produce from the plantation. The expression "income" in its normal connotation does not mean mere production or receipt of a commodity which may be converted into money. Income arises when the commodity is disposed of by sale	 consumption or use in the manufacture or other processes carried on by the assessee qua that commodity. There is no reason to think that the expression "income" in the Act has any other connotation. A tax on income whether agricultural or non agricultural is	 unless the Act provides otherwise	 a tax on monetary return actual 	or notional. Section 4 of the Act supports that view	 for in the 953 total agricultural income is comprised all agricultural income. derived from a plantation in the State. It is not necessary	 however	 for income to accrue that there must be a sale of a commodity: consumption or use of a commodity in the business of the assessee from which the assessee obtains benefit of the commodity may be deemed to give rise to income. Therefore	 merely because the produce of his plantation was received in the earlier years	 assuming that the appellant 's case is true	 income derived from sale of that produce in the year of account is not exempt from tax under the Act	 in that year. Counsel for the appellant strongly relied upon a judgment of this Court in Dooars Tea Co. Ltd.	 vs Commissioner of Agricultural ' Income tax	 West Bengal(1) a case decided under the Bengal Agricultural Income tax Act 4 of 1944. It was held in interpreting the definition of section 2(1) (b) of the Bengal Agricultural Income tax Act	 1944	 which is in substantially the same language as the definition under the Act that it was not predicated of the agricultural ' income that it must be sold and profit or gain received from such sale before it can be included in the definition of agricultural income. In Dooars Tea Co. Ltd. case (1)	 the appellant grew bamboos	 thatching grass and fuel by agricultural operations and utilized the products for the purpose of its tea business. The claim of the Income tax authorities to tax the value of the produce was resisted on the plea that the produce was not sold. In rejecting that plea	 the Court observed at p. 13: "In terms the clause [section 2(1) (b)] takes in income derived from agricultural land by agriculture; and as we have already pointed out giving the material words their plain grammatical meaning there is no doubt that agricultural produce constitutes income under this clause. Is there anything in the context which requires the introduction of the concept of sale in interpreting this clause as suggested by the appellant? In our opinion this question must be answered in the negative. Not only is there no indication in the context which would justify the importing of the concept of sale in the relevant clause	 but as we have just indicated the indication provided by clauses (ii) and (iii) is all to the contrary. What this clause seems clearly to have in view is agricultural produce itself which has been used by the assessee. " But these observations do not	 in our judgment	 imply that agricultural produce when received by a person carrying on agricultural operations becomes income in his hands. The Court in that case was concerned to deal with a limited question whether a (1) ; ; 7Sup. C.I./66 16 954 person who has raised agricultural produce instead of selling it uses that produce for his own business	 can he be said to have earned agricultural income? The Court in that case held that he would be deemed to be earning income. The decision is authority for the proposition that for agricultural income to arise	 it is not predicated that the agricultural produce must be sold: user of agricultural produce for the purpose of the business of the assessee may give rise to agricultural income. The decision in State of Kerala and Anr vs Bhavani Tea Produce Co. Ltd.(1) on which reliance was placed by counsel for the appellant has	 in our judgment	 no relevance whatever in this case. In Bhavani Tea Produce Company 's case (1) the assessee was required under section 25 of the 	 to deliver the coffee produced by it to the Coffee Board and the question which fell to be determined was whether such delivery constituted sale by operation of law as a result of which the assessee ceased to be the owner of the coffee	 the moment it handed over the produce to the Coffee Board. This Court held that under the relevant provisions of the Act as soon as the producer of coffee handed over the produce to the Coffee Board	 it ceased to be the owner and income accrued to him at that point of time. That case does not lay down the proposition that income accrues to a producer of agricultural produce before the date of disposal	 use or sale. The second argument raised by the appellant has also no substance. For the years 1955 56 and 1956 57 the appellant did not submit returns of income	 but applied to compound the tax under section 65 of the Act	 and paid the tax determined at the rates specified in Part 11 of the Act. Therefrom it cannot be inferred that the produce which was sold by him in the year of account to which these appeals relate had suffered tax in the earlier years. It has to be proved that the crop sold by the appellant related to the years in respect of which he had applied to compound the tax; and on that part of the case there is no evidence. The appeals therefore fail and are dismissed with costs. There will be one hearing fee. V. I P.S. Appeals dismissed.

The appellant owned a cardamom plantation. For the assessment year 1957 58	 he submitted a return under the Madras Plantations Agricultural Income tax Act	 1955. The Agricultural Income tax Officer did not accept the return	 and 'added to the income the value of stocks of cardamom sold in the accounting year. The High Court in revision	 confirmed the assessment made by the Department. In appeal to this Court	 it was contended that: (1) the agricultural produce itself was income and became charged to tax under the Act when it was received and not when it was sold	 used or consumed	 and therefore	 the High Court ought to have directed determination of the produce which was actually derived from agriculture in the year of account and ought to have brought to tax only that quantity and excluded the value of the rest of the produce received in earlier years	 from taxation; and (2) from the fact that the appellant applied to compound the tax for the earlier years	 it must be inferred that the produce which was sold by him in the year of account had already suffered tax in the earlier years. HELD : (1) Merely because the produce of the plantation was received in the earlier years	 income derived from sale of that produce in the year of account was not exempt from tax under the Act in that year. [953 B] Section 3 of the Act read with the definition of "agricultural income" charges to tax the monetary return either as rent or revenue or agricultural produce from the plantation. The expression "income" in its normal con notation does not mean mere production or receipt of a commodity which may be converted into money. Income arises when the commodity is disposed of by sale	 consumption or use in the manufacture or other processes carried on by the assessee qua that commodity. It is not necessary	 however	 for income to accrue that there must be a sale of a commodity : consumption or use of a commodity in the business of the assessee from which the assessee obtains benefit of the commodity may be deemed to give rise to income. [952 G H; 953 A B] Dooars Tea Co. Ltd. vs Commissioner of Agricultural Income tax	 West Bengal; 	 	 referred to. (2) It had to be proved by evidence that the crop sold related to the years in respect of which the assessee had applied to compound the tax	 but there was no such evidence. [954 F]