Tsolekile had accused Smith of treating him indifferently with regards to selection in the playing XI.
Appointed South Africa captain at the age of just 22 in 2003, Smith held the post until his retirement 11 years later, culminating a great run that saw Proteas overcome the fixing saga and be one of the major forces in Test cricket.
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Tsolekile, who played 3 Tests for South Africa, was banned for 12 years over alledged involvement in fixing matches in 2015.
The 39-year-old black South African cricketer was critical of Smith's captaincy, the treatment handed to him with regards to selection in the playing XI and also said that the CSA, at where his former captain is now director of cricket, has been trying to protect other wrongdoers in the fixing case.
Smith, in a fine response, took to Twitter and posted his statement.
"Thami Tsolekile was my captain at South Africa schools junior level. I have never had an issue with him as a person and he has never borne out the frustrations of his international career on a personal level," he wrote.
"In fact, my personal relationship challenges with several other players, of all races, have been well documented in the past. It was impossible for me to win everyone's approval at the same time but that is the nature of professional sport."
During his playing days, Tsolekile was considered the back-up gloveman to current coach and one of the best in history of the game, Mark Boucher.
Unfortunately, though, there was no place for him in the XI even when Boucher's eye accident forced him to bid immediate retirement on the 2012 tour of England, where to serve the team's balance, Smith and the management preferred AB de Villiers keeping wickets.
Smith, on his part, cited the fact that there have been many tough decisions taken in the past for the betterment of the team.
"The allegations and insinuations that have been made are extremely hurtful and I deny them in the strongest possible sense."
"Lance Klusener and Shaun Pollock can attest to this, and there were very emotional discussions because they are both legends of our cricket history."
"Shaun was ushered out of the Test team in a similar manner to Makhaya Ntini, when he felt he could have still done a job. Almost every player I have come across feels that they could have contributed more."
"It is easier to shift bowlers and batters around to suit the needs of a team, but some positions are specialist."
On Tsolekile's case, Smith explained: "Unfortunately, Thami was a wicket-keeper, which meant he was always only fighting for one position.
"I can understand how frustrating that must have been, and there have been several other excellent wicket-keepers that South African cricket never saw on an international stage, because keepers tend to stay in a team for long periods of time. That is also an international trend, not unique to South Africa."
The 39-year-old stressed his was never the decisive voice in the selection meetings and the final word always resided with the selectors and the coach.
"I should emphasise that I was never in charge of selections. I had an opinion as a captain, but the casting vote was with the coach and the selectors," Smith wrote. "In the case of the 2012 tour to England, which Thami has alluded to, there was a whole panel of selectors."
"Thami was in the squad as reserve keeper to AB de Villiers and this was communicated to him on both the England and Australian tours by Gary Kirsten, which has been previously acknowledged by Thami."
"I also never had any say on the financial structure. I did not determine contracts, and I also did not decide match fees. I was a player," he added.
(Inputs from PTI)