The law in Diageo India Pvt Ltd v. Dy CIT (2011)  47 SOT 252 (Mum) (Trib)  that the definition of “Associated Enterprises” in section 92A(1)(a) & (b) is the basic rule which is unaffected by the specific instances referred to in s. 92A(2) is not good law in view of the amendment by the FA 2002 and CBDT Circular No. 8 dated 27.08.2008. The correct law as held in Veer Gems 95 taxmann.16 (Guj) is that S. 92A(2) restricts the scope of S. 92A(1) and it is only when the criterion specified in sub section (2) is satisfied, two enterprises can be treated as associated enterprises. Judgements of non jurisdictional High Courts are binding on the Tribunal .  Tribunal held that the relationship between assessee and KES was not AEs and  accordingly no arm’s length price  adjustments could be made on the transactions between these two entities . Addition is deleted .( ITA No 2165/Mum/15, dt. 28.02.2020)(AY. 2007-08)