Let's analyze the given statements regarding RNA polymerase in prokaryotes:

Statement I: In prokaryotes, RNA polymerase is capable of catalysing the process of elongation during transcription.

In prokaryotes, RNA polymerase is indeed responsible for transcribing RNA from a DNA template. It performs various functions during transcription, including the elongation phase, where it synthesizes RNA by adding nucleotides to the growing RNA strand. Hence, Statement I is true.

Statement II: RNA polymerase associates transiently with the ‘Rho’ factor to initiate transcription.

This statement is incorrect. In prokaryotes, RNA polymerase associates with the sigma factor ($\sigma$) to initiate transcription. The sigma factor helps the RNA polymerase to recognize the promoter regions of the DNA. The Rho factor ($\rho$), on the other hand, is involved in the termination of transcription, not the initiation. Thus, Statement II is false.

Considering the above explanations, the correct answer is:

Option A: Statement I is true but Statement II is false