A consultant and a contract employee are as different as chalk and cheese. A consultant is not an employee, is a freelancer and gets paid for the services rendered. The status and obligations of the employee do not accrue to such a person. A contract employee, on the other hand, is an employee bound by the contract conditions for the period of engagement.
These are the general observations from the point of labour laws. However, for an Act like the Income Tax Act 1961, there is no distinction between the two. If the matter is to be examined from any specific statute, it shall be mentioned.