Applicability of section 194C: payments under community implemented rural employment schemes not subject to contractor TDS deduction. Section 194C withholding applies where a contractual relationship with a contractor or sub contractor exists and creates an obligation to deduct tax at source. Payments under NREP and RLEGP are not subject to section 194C because implementation is through Panchayati Raj institutions and voluntary organisations under State supervision, the schemes ban engagement of contractors or intermediaries, and there is no contract with State Governments that would attract section 194C.