Bhushan retweeted a media report that quoted Aam Aadmi Party leader Kumar Vishwas and called it as "absurd".
He said that "There are no talks or possibility of our returning to AAP, which has betrayed all the ideals of the anti-corruption movement," Bhushan tweeted.
Yadav took to Twitter and said he was "surprised" on reading what Vishwas had said a day before.
"Really? Must be very secret, since both of us have not heard about it! In my knowledge, there is no possibility of this happening," he said in a series of tweets.
Kumar Vishwas on Sunday expressed displeasure over the AAP's functioning and said the party needed to go back to the basics.
He said the party workers were in talks with many of their colleagues who had since left the AAP, including Prashant Bhushan and Yogendra Yadav, and apologised for any wrongs done by the party.
Yadav and Bhushan were sacked from the AAP in March 2015 for alleged anti-party activities. They had hit out at AAP chief Arvind Kejriwal over his "supremo style of functioning" and lack of transparency in the party.
In October 2016, the two launched a new political outfit Swaraj India.
(with input from agencies)