As stated in the General Guidelines for this forum, we do not answer questions on facts for the reasons stated therein. So, we cannot comment in detail as to what stand you should take in defence. However, generally speaking, you can deny her allegations of cruelty. At the same time, since you appear to be having your own counter-allegations of cruelty, you can mention the same in your reply.
As both of you seem to be willing for divorce, it may be advisable to go in for a mutual consent divorce.
Yes, alimony would generally be decided at the time of passing decree of divorce.
For your third question, read: How is the amount of alimony or maintenance computed on divorce?
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