Earlier, Rao Anwar, while speaking during a TV interview, had termed the former IGP a "hypocrite" and accused him of issuing orders to "kill criminals and dump their bodies" among other things.
In the notice, the former IGP termed the claims of Anwar as false and baseless, and accused the latter of being a "notorious officer".
Khawaja denied having any conversation with the former SSP regarding the killings of the suspects in "encounters and dumping of bodies".
He denied the allegation that the father of late Naqeebullah Mehsud — a Waziristan native killed in an encounter in 2018 — was summoned to Karachi by him.
He also denied the allegation that he ordered the use of force against a Tehreek-e-Labbaik (TLP) procession in Karachi a few years ago.
He asked Anwar to tender an apology within 14 days of receiving the legal notice and to pay a sum of Rs50 million as damages, failing which legal proceedings will begin against him in a court of law.