Please Help to write a letter

[vishalinit]

Hi,
PLZ help me to write a letter to a vendor:

This has referance to your letter dated xyz .
As discussed with Mr. ABC I am sending herewith a cheque of Rs 111 in favour of "XYZ" , which is the amount credited in my account by mistake.
Please clear my settlement / please settle my account and provide me with the clearence certificate.

Thanks and Regards
Vish

[Tdol]

This has referance to your letter dated xyz . - Does the letter have a reference number or anything?
As discussed with Mr. ABC- As agreed with Mr ABC,
in favour of "XYZ"- I would use 'payable to xyz'
credited in my account- credited to...
please settle my account- use this one