A 40-year old iron trader was shot dead on a road in Howrah's Ghusuri on Thursday night, police linking the murder to the victim's refusal to pay an extortionist.

Ajay Shaw, a resident of Girish Ghosh Road, was buying sweets at 11pm from a shop in Ghusuri Bazar when Mohammad Faruk Ansari, 35, and three of his associates allegedly accosted him.

Police said Ansari had demanded Rs 20,000 from Shaw, who had a shop at Ghusuri.

A witness said Ansari asked the trader why he was not paying up despite repeated demands. When Shaw made it clear that he would not pay, Ansari whipped out a country-made gun and shot Shaw in the head at point-blank range.

'Shaw was bleeding profusely. We took him to TL Jaiswal Hospital within a few minutes but doctors declared him dead,' Ashok Ghosh, the owner of the sweet shop, said.

He said as soon as Shaw slumped to the ground, Ansari fled riding Shaw's motorcycle. 'No one dared to stop him as he was armed.'

An officer of Belur police station said Ansari and Shaw knew each other for more than 10 years and had ventured into real estate projects together.

The two were mainly into property brokerage in Ghusuri. Shaw used to run his shop along with the real estate business, with Ansari helping him with strong-arm tactics, said a source.

About two years ago, differences cropped up between the two over sharing of commission from the sale of an old house, the police said.

Police said Ansari had a criminal record and been arrested several times on extortion charges. The officer said preliminary investigation has revealed that Ansari had phoned Shaw around 10.30pm and asked him to come near the sweet shop for a discussion. All neighbouring police stations have been alerted about Ansari and his associates.

'Ansari had been demanding Rs 20,000 from my brother for the past 15 days. He even threatened him,' Shaw's brother Anil said. 'He did not imagine that Ansari would kill him if he refused to pay. He thought Ansari was only trying to scare him.'

Anil demanded Ansari's immediate arrest.

This is the second incident in the past year of extortionists shooting businessmen in Howrah for not meeting their demands.

On July 11 last year, extortionists fired randomly at the house of a construction material supplier in Bally's Sapuipara area after he refused to pay even after repeated threats.