Calcutta Paper Traders’ Association’s president Sushanta Dhar (centre) with special commissioner of sales tax H. Duari (left) in Calcutta on Saturday. Picture by Kishor Roy Chowdhury

Calcutta, March 18: The script prepared by the paper industry of Bengal doesn’t read nice.

First of all, out of the 16 to 17 paper mills in the state only six to seven are fully operational and Bengal’s demand for paper is mostly met from outside.

According to the available statistics, the state consumes more than five lakh tonnes of paper annually while it produces only around one lakh tonnes.

While the mills are in a sorry state, paper traders are in a fix over a Calcutta High Court ruling that forbids the issue of C forms before purchase. Paper traders need to submit C forms, which are issued by the tax department, before lifting their stocks from the suppliers.

“We are facing a lot of problems due to the non-availability of C forms,” said Sushanta Dhar, chairman of the Calcutta Paper Traders’ Association.

If a trader is unable to furnish C forms, then he or she can take delivery of the supply against monetary deposit. “But the condition of the industry in the state is such that paper traders cannot afford to keep cash locked in such a manner before procuring the material,” Dhar said.

The CPTA has been advised by the state government, through the Bengal National Chamber of Commerce and Industry (BNCCI), to file a token case against the ruling.

The state has assured the association that it will not contest the petition. The association is hopeful that if the petition is not contested by the government it will eventually lead to the squashing of the ruling.

Moreover, most of the traders are yet to receive the value added tax (VAT) registration certificates, which is also acting as a hurdle to the growth of the trade.

During better times, Bengal paper mills had plantations in Jharkhand and Orissa on lease as the state’s raw material capacity, excluding the Himalayan foothills, is only 30000 tonnes annually.

“But now the leases have expired and these plantations have been taken over by other mills as the pressure on raw material is tremendous as six to seven lakh tonnes of raw material is required for every one lakh tonnes of paper produced,” said Balaram Kundu, ex-president of CPTA.

“All the discussions about reviving paper mills and making heritage museums are yet to bear fruit as such projects are capital intensive and to operate a plant with one-lakh-tonne capacity requires an investment of Rs 1 lakh,” Kundu said.