Admissibility of prior period item in Income tax act

We have incurred Around6 lacs of local authority expense of which only 1 lacs pertains to current period while remaining relates to previous periods.

The notice for the same expense was served for the 1st time in May'11 by the local authority for all the previous years i.e. from 2005-06 to 2010-11.

We have paid the full amount in July'2011.

Can we claim these expense in full?

if yes, then are these expenses allowed in the F.Y 2010-11 by making provision or in F.Y. 2011-12 in which we have paid?

Expecting early response....