The Coca-Cola Company's troubles in India continue to drag on. Having suffered the effects of a contamination scare across the country, the company is now defending itself against charges that one of its bottling plant is sucking a local village dry of its water supply.

The charges were made in April when Hindustan Coca-Cola Beverages, Coca-Cola's subsidiary in India, had a licence renewal denied for its plant at the village of Perumatty on grounds the plant had resulted in a general water shortage in the village. Coca-Cola lodged an appeal against the ruling with the Kerala High Court.

Coke, on the order of a Kerala judge, is now in the process of giving evidence to the small village council in southern India in an attempt to keep the bottling factory open.

Coke has strongly denied the allegations and has argued there has been no water over use. "The villagers are not suffering and we are not exploiting the water resources," the Coca-Cola plant manager N Janardhanan told Associated Press.

The company did admit that there was a water shortage but said it was the result of lack of rain. And Coke now sends water tankers round every morning to supply the minimum needs of villagers.

However, Coke's arguments have not been completely convincing for the president of the council who dismissed the company's case as "incomplete and unsatisfactory".

He added that a decision would be made on the future of the plant within 10 days.