Labour Party leader Pat Rabbitte said he used a donation from Frank Dunlop to pay election expenses before returning it to the lobbyist a month later.
Mr Rabbitte yesterday accused Mr Dunlop of embellishing his account of their meeting in 1992, and claimed the lobbyist had gilded the lily, manufactured detail and put a construction on events that didn't happen.
However, he accepted that in November 1992 he received a £2,000 (€2,540) cash donation given by Mr Dunlop on behalf of a small number of clients.
Mr Dunlop has alleged that the amount was £3,000 (€3,810) and claims that he referred to lands at Ballycullen during their meeting. Mr Rabbitte, who was then a Democratic Left county councillor, had voted to rezone these lands several weeks earlier.
Mr Rabbitte insisted yesterday he had no meeting with Mr Dunlop about Ballycullen and said there was no planning context to their discussions.
The two men's accounts of the meeting differ sharply. Whereas Mr Dunlop has said their meeting was pre-arranged, Mr Rabbitte said he was surprised when the lobbyist turned up at his door.
He said they had an animated discussion about the progress of the election campaign, about which Mr Dunlop was immensely well informed.
Mr Dunlop has said the meeting took place on November 11th, six days after the election was called. Mr Rabbitte said he believed the meeting took place later in the campaign.
Mr Rabbitte said he made it clear to Mr Dunlop that Democratic Left's local constituency council would have to decide whether or not to accept the donation.
After half an hour of conversation, Mr Dunlop rose to leave, Mr Rabbitte recalled. He took an envelope out of his pocket and put it on the desk. After his guest left, he counted the money and found it contained £2,000.
Ms Dillon pointed out that Mr Dunlop was claiming the amount involved was £3,000.
Mr Rabbitte said he had great difficulty with the suggestion that he retained part of the donation.
He pointed out that Mr Dunlop, in a handwritten note to the tribunal in 2000, hadn't said part of the money was not returned.
"At no stage in any of the papers you sent me is there any statement from Frank Dunlop from which it could be inferred that anything less than the full donation was returned."
Mr Rabbitte said he stuck the envelope in a drawer and left the house. While he had no idea what the money was used for, he believed it was spent on normal election expenses.
Mr Rabbitte pointed out that he was the only witness who had returned a donation and yet this was attracting more interest than donations that weren't returned.
Some years later, he had a "pretty frivolous encounter" with Mr Dunlop in Brown Thomas. They exchanged some banter and Mr Dunlop told him he had already spent £121,000 preparing for the tribunal.
Mr Dunlop has claimed Mr Rabbitte said he presumed "that matter between us will never come up".
Mr Rabbitte denied saying this, but pointed out that Mr Dunlop had rung him at this time asking him the precise amount of a certain "non-donation".
Ms Dillon said the tribunal had asked Mr Rabbitte in 1999 whether he had received any money from Mr Dunlop and he had replied that he hadn't. Was this accurate?
Mr Rabbitte said it was. He hadn't got £2,000 from Mr Dunlop. It had been returned. "We didn't accept the payment. I didn't get any benefit from the payment. The same amount as I got was returned. I didn't solicit it, I didn't ask for it and we sent it back."
