Only agricultural income is exempt u/s 2(1A) read with section 10 (1) of the Act. Dairy income (Milk from Cow ) is taxable . In State of Orissa v. Ram Chandra Choudhury (1962) 46 ITR 246 (Orissa ) (HC) applying the ratio laid down by Supreme Court in CIT v. Raja Benoy Kumar Sahas Roy (1957) 32 ITR 466 (SC) held that Dairy -farming will not be agricultural operation and income from Dairy farming will not be agricultural income . Accordingly sale of milk cannot be claimed as exempt.

On the facts if the Assesee is only having dairy farming income which is below 2,50,000 lakhs, then it is below taxable limit as per slab rate in which assessee falls. In case the Assessee is having income other than dairy farming income and considering all the income, if the assessee crosses the threshold limit, then Income of the Assessee is taxable.