Franklin one had lower rated bonds and faced trouble when things went south. They had to close down and return money i think - there were multiple funds from franklin which closed down. Before that it had a high yield, because it held those kind of bonds. So basically it was a credit risk + ultra short term bond. Not all ultra short term funds will do that, i think most don’t.
So you have to read what the fund can and cannot do and also look at portfolio. treps, repo etc are all safe, treps has collateral with 3rd party, look it up. I put a lot of trading capital in overnight funds, and they hold treps and similar things (and in return yield is lower). Liquid funds also are generally safe.
yeah, just take growth funds to avoid dividend always. Irrespective of TDS, dividend is anyway tax inefficient. I only hold growth funds, TDS cannot apply there as its taxed only when you book gains.