DY, its use is not prohibited. It is a useless object (muktze machmat gufo) as you cannot use it on Shabbat (unless you are a Chabadnik – the Ball HaTanya allows ripping toilet paper). The reason why it can be used in a case of dire need (altouugh not ripping on the perforations) is that it is an issur d’rabbanan being that you do not care about the exact size of the paper. Kevod haberiot overrides d’rabbanans.
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