For an hour-and-a-half yesterday, the Senate put aside all other issues in President Carter's urgent $20 billion tax cut bill to talk about the tax treatment of two chicken processing companies one in Maine and the other in Arkansas.

Some of the Senate's most famous men, such as Edmund S. Muskie (D. Maine), John L. McClellan (D-Ark.) and James B. Allen (D-Ala.), engaged in an impassioned debate on what they called a tax injustice that a 1976 tax amendment had imposed on Corbett Enterprises of Maine and Hudson Foods, Inc., of Rogers, Ark.

Dale Bumpers (D-Ark.), chief sponsor with Muskie of an amendment to correct the alleged injustice, said he didn't like to make "special pleas" for special interests, but that this situation was "outrageous."

Muskie said the claimed inequity could cost Corbett up to $1.5 million a year in extra taxes for up to 10 years, putting it at an extreme disadvantage against competitors not subject to the same new tax provision.

Opposing Bumpers and Muskie, Sen. Edward M. Kennedy (D-Mass.), leaped to his feet and called the proposed chicken amendment, which passed 85 to 12, a classic example of the way special-interest legislation is brought to the Senate floor to benefit one or two taxpayers. He also claimed the senators were not dealing with chicken feed.

"We're not talking about a little Mom-and-Pop store, we're talking about tens of millions of dollars," Kennedy shouted. But he was snowed under in the vote by Bumpers and Muskie.

The dispute involved a provision of the 1976 tax laws that requires firms engaged in farming enterprises to shift from the cash accounting method, for the purpose of computing taxes, to the accrual method. The requirement went into effect Jan. 1, 1976.

The accrual method better reflects inventory buildup by a business, and, in effect, reduces current writeoffs on the total cost of inventory buildup. A smaller writeoff on inventory means a higher income and a higher tax.

The Treasury Department already requires virtually all nonfarm corporations with substantial inventory to use the accrual method because it believes it reflects real income better.

While requiring farms and related businesses to shift to the accrual method, Congress exempted several categories of agri-businesses from the new requirement, namely, unincorporated enterprises, incorporated enterprises with less than $1 million sales, and incorporated farms and farm-related businesses owned 50 per cent or more by one family. The idea was to exempt "the family farm" from the new, tougher accounting methods.

Bumpers said in practice this has worked out unfairly because it allows some extremely large family-owned chicken processors to stay on the cash method, while forcing smaller competitors such as the Maine and Arkansas firms, which don't qualify for any exemption, to use the accrual method. This means higher taxes for the latter and puts them at a competitive disadvantage, he said.

Bumpers and Muskie freely conceded to the Senate that they were raising the issue solely on behalf of the two companies in their states.

Hudson, the Arkansas processor, has gross sales of $65 million and processes about 42 million chickens a year. Corbett Enterprises has six plants in five states, including one called the Fort Halifax Packing Co. in Winslow, Maine, and processes about 83 million birds a year, Muskie aides said. Corbett also has a subsidiary on Maryland's Eastern Shore, Cherapeake Foods, Inc., of Parsonburg, which processes chickens.

Muskie and Bumpers said both companies were being forced onto the accrual method by the 1976 law. What they said they wanted was a tax bill amendment to postpone the accrual requirement for Corbett and Hudson for one year, giving Congress time to study the special farm exemption. Kennedy railed that that was no way to write tax legislation.