require builder returning false in rails 3

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I am upgrading my rails application from rails 2.3 to rails 3.1. I am using builder like this

b = Builder::XmlMarkup.new :target => @data, :indent => 2

this works in rails 2.3 but not in 3.1.

Also, when i try to execute require 'builder' from rails console it works in rails 2.3 but says false in rails 3.1

Also, when i try to execute xm = Builder::XmlMarkup.new on console it prints <inspect>.

Also, when i do bundle show in rails 2.3 i see that builder is of version 3.2.2 but when i am checking the same in rails 3.1 builder is 3.0.4.

Can anyone help. Thanks.

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