There are two types of taxes 1) Direct tax like Income tax, Wealth tax etc and 2) Indirect tax like excise, vat, service tax, sales tax etc.
In your case you have to income tax on profit and also depend upon type of constitution like company, firm, proprietary firm etc.
In case of indirect tax you have to service tax on interior decoration (labour job work) and local sales tax (on good provided). As your cost of services provided is not more than Rs. 8,00,000, hence not require to pay service tax. You have to check out local sales tax law relating to works contract.
I slightly differ from the view expressed by Mr. Shrikant. VAT and WCT are state levies. VAT is on transfer/sale of good goods. WCT is a composition scheme where the contract is a composite one. TDS is relates to Income Tax. The threshhold exemption available to the service provider is on the value of services of rendered by him(in your case the civil contractor/interior decorator) and not on the quantum of service given by u. What do u meant by "If the contractor provides relevant registration, the particular tax will be exempted" Check up with the contractor.