WHy is US denying this?
No clue. You’d have to look for the pattern of things the U.S. almost certainly hit and later denied.
The Al Jazeera article suggests hitting water infrastructure is always a war crime, and then references a non-binding memo, which hints at the fact that the claim is bullshit, something cursory searching confirms. That’s probably not it since both the U.S. and Iran have proudly owned up to and threatened war crimes throughout this stupid war.
Even true things like the imminent award of an honor are "fake news" (Mark Twain Award, to Bill Maher). War crimes are, well, unseemly.