Automated Guided Vehicles are widely used as an essential material handling system for FMS to provide flexibility and efficiency. We suggest a new dispatching rule based on priority function which considers urgency and empty vehicle travel time under finite buffer capacity. We evaluate the performance of the proposed rule by comparing the performance of Shortest Travel Time/Distance(STT/D) rule in terms of machine utilization, throughput and WIP level using simulation. The simulation results show that the suggested dispatching rule is robust and provides better machine utilization, throughput with comparable WIP level compared to STT/D rule.