Import Projects Errored - Issue with Organization

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Hello all

While converting Capital Projects, i am getting this error - "The organization is invalid because it can't own projects with the class Capital, Contract. Select a different organization."

The Organization has been classified as Project/Task owning and expenditure org. And It is available in Project Hierarchy also - in Manage Organization Trees.

I am not getting this issue when i convert Grant Projects. Any ideas..

Thanks

Anandh