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Issue with xsl:number used in BIP Report

Summary
xsl:number used for formatting in BIP Report doesnt work.
Content
Hi All,
BIP newbie here. I am building an RTF template, where I am required to show continuous values for a column called 'category' like A, B, C.
I have a for each loop where I traverse this value and within that loop, I have a field which computes to <xsl:number format="A. " level="any"/> . This works quite well when i test it on the word plugin for desktop.[see image A]. But when i deploy this rtf as a layout on the xmpl server, this stops computing.[see image B].
Can someone guide me as to what I might be doing wrong?
I am attaching teh template and the corresponding xml for your review.