The Area News can reveal an investigation by the Australian Competition and Consumer Commission found the company committed multiple breaches of the rules governing water charges. As a consequence, MI has repaid $640,134 - including interest - to 35 customers and been issued with three infringement notices totalling $66,000.

It will also be required to have a court-enforceable declaration, in which it admits its indiscretions, entered onto a public register.

Between September 1, 2009 and March 31, 2010, MI imposed termination fees in excess of those legislated on 35 customers permanently trading their water out of the area.

In July, the ACCC sanctioned Murray Irrigation Limited under the same Water Charge (Termination Fees) Rules, which were introduced on September 1, 2009.

The rules mandate what irrigation infrastructure operators such as MI can charge irrigators terminating access to its irrigation network.

When contacted by The Area News the ACCC would not comment on whether the company had been investigated, but an email circulated among MI staff last week confirmed the breaches.

"To address ACCC's concerns about its future compliance with the rules, MI has taken steps to amend its practices, we have provided refunds with interest to affected customers totalling $640,134, and we have given the ACCC a court-enforceable undertaking under s.163 of the Act," it said.

"The undertaking includes, among other things, a commitment by MI to refrain from imposing termination fees that are not authorised under the rules and to institute a compliance program.

"MI will also pay three infringement penalties totalling $66,000."

Warburn irrigator Kel Williams was one of the irrigators to be refunded and said he welcomed the findings of the ACCC.

However, he said he was disappointed the watchdog did not appear to have investigated whether similar breaches had occurred in earlier years.

MI's managing director Brett Tucker declined to comment on the matter at this stage, saying that a statement would be issued "in due course".