diff --git a/libraries/tools/kotlin-gradle-plugin-core/src/main/kotlin/org/jetbrains/kotlin/gradle/plugin/KotlinPlugin.kt b/libraries/tools/kotlin-gradle-plugin-core/src/main/kotlin/org/jetbrains/kotlin/gradle/plugin/KotlinPlugin.kt
index ca444ee7d7a..1c6318c6bc3 100644
--- a/libraries/tools/kotlin-gradle-plugin-core/src/main/kotlin/org/jetbrains/kotlin/gradle/plugin/KotlinPlugin.kt
+++ b/libraries/tools/kotlin-gradle-plugin-core/src/main/kotlin/org/jetbrains/kotlin/gradle/plugin/KotlinPlugin.kt
@@ -135,9 +135,10 @@ open class KotlinAndroidPlugin [Inject] (val scriptHandler: ScriptHandler): Plug
 
         ext.getSourceSets().all(object : Action<AndroidSourceSet> {
             override fun execute(sourceSet: AndroidSourceSet?) {
-                if (sourceSet is ExtensionAware) {
+                if (sourceSet is HasConvention) {
                     val sourceSetName = sourceSet.getName()
-                    val kotlinSourceSet = sourceSet.getExtensions().create("kotlin", javaClass<KotlinSourceSetImpl>(), sourceSetName, project.getFileResolver())!!
+                    val kotlinSourceSet = KotlinSourceSetImpl( sourceSetName, project.getFileResolver())
+                    sourceSet.getConvention().getPlugins().put("kotlin", kotlinSourceSet)
                     val kotlinDirSet = kotlinSourceSet.getKotlin()
                     kotlinDirSet.srcDir(project.file("src/${sourceSetName}/kotlin"))
 
@@ -264,7 +265,14 @@ open class KotlinAndroidPlugin [Inject] (val scriptHandler: ScriptHandler): Plug
     }
 
     fun <T> getExtention(obj: Any, extensionName: String): T {
-        return (obj as ExtensionAware).getExtensions().getByName(extensionName) as T
+        if (obj is ExtensionAware) {
+            val result = obj.getExtensions().findByName(extensionName)
+            if (result != null) {
+                return result as T
+            }
+        }
+        val result = (obj as HasConvention).getConvention().getPlugins()[extensionName]
+        return result as T
     }
 
 }
diff --git a/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/build.gradle b/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/build.gradle
index a7dd2eff81e..2fac2cafaa1 100644
--- a/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/build.gradle
+++ b/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/build.gradle
@@ -25,6 +25,14 @@ android {
         annotations = "kotlinAnnotations"
     }
 
+    sourceSets {
+        main {
+            kotlin {
+                srcDirs = ['root/kotlin']
+            }
+        }
+    }
+
     defaultConfig {
         minSdkVersion 7
         targetSdkVersion 16
diff --git a/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/src/main/kotlin/org/jetbrains/kotlin/gradle/test/androidalfa/MainActivity2.kt b/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/root/kotlin/org/jetbrains/kotlin/gradle/test/androidalfa/MainActivity2.kt
similarity index 100%
rename from libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/src/main/kotlin/org/jetbrains/kotlin/gradle/test/androidalfa/MainActivity2.kt
rename to libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/Android/root/kotlin/org/jetbrains/kotlin/gradle/test/androidalfa/MainActivity2.kt
diff --git a/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/gradle.properties b/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/gradle.properties
new file mode 100644
index 00000000000..59b261a6689
--- /dev/null
+++ b/libraries/tools/kotlin-gradle-plugin/src/test/resources/testProject/AndroidProject/gradle.properties
@@ -0,0 +1 @@
+org.gradle.jvmargs=-XX:MaxPermSize=512m
\ No newline at end of file