The Tigers broke off talks 10 days ago
Tamil Tiger rebels have warned the Sri Lankan Government that its latest plan for relocating a high security zone in rebel heartland is unacceptable.
The rebels said the proposed new site in the northern Jaffna peninsula was too close to busy public areas and could provoke protests.
Renewed disagreement comes as the government and Norwegian mediators are desperately trying to woo the Tigers back to the negotiating table.
The rebels broke off talks 10 days ago, complaining they had been marginalised, and cut off direct contacts with Norwegian officials.
Meanwhile, two senior peace negotiators for the Sri Lankan Government have arrived in Delhi for talks with Indian officials.
Norway's deputy foreign minister, Vidar Helgesen, and Japan's special envoy, Yasushi Akashi, will take part in the meetings.
Although India is not actively involved in its neighbour's peace process, Colombo has kept Delhi closely informed of developments.
The BBC's Frances Harrison in Colombo says the issue of relocating government troops currently occupying the two biggest hotels as well as some private houses in the heart of Jaffna town has proved endlessly controversial.
Jaffna saw some of the bitterest fighting of the war
Everyone agrees the soldiers should move so as to help civilians in Jaffna return to normal life, but there is disagreement about where they should move to.
Our correspondent says the entire ethos of the ceasefire agreement is that the balance of power between the two sides' military forces is not disturbed while they negotiate.
Ultimately the Tigers would like to see the demilitarisation of the Jaffna peninsula, where 40,000 government troops are stationed.
But for the time being it is only an issue of relocation.
The government initially planned to move the soldiers to municipal land near Jaffna fort, but the Tigers objected on the grounds that it gave the army a strategic advantage overlooking the coast.
Following the Tigers' suspension of peace talks, the chief government negotiator announced last week they had found a solution to the problem - moving to premises in Jaffna formerly occupied by the police.
The Tigers have responded by writing to the secretary of defence saying they see no meaningful change in the new proposal because the suggested site is too close to busy public areas of the town.
The rebels argue the spirit of the truce agreement is to minimise the military presence in densely populated areas and this does not achieve that aim.
There is also an ominous threat of disturbance from the head of the Tigers' political wing, SP Thamilselvan, who says he is afraid this latest proposal would bring about public agitation.
This is just one of the outstanding issues that needs resolving before the Tigers resume peace talks but our correspondent says it is clearly not going to be as easy as the government hoped.