SRINIVASAN, J.

The pivotal issue in this case is whether after the coming into force of the All India Council for Technical Education Act, 1987 (Act 52 of 1987), the State Government could withdraw the permission granted earlier to the Writ Petitioner to start a private Engineering College and the University of Madras could cancel or withhold affiliation to the college on the ground that the conditions imposed respectively by the State Government and the University for the grant have not been fulfilled. The other issues are only ancillary and answers thereto will depend on the answer to the above issue. For the sake of convenience, the parties are referred to by their rank in the writ petitions.

2. The writ petitioner is a registered Trust by name The Adhiyaman Educational and Research Institution. The petitioner applied to the Government of Tamil Nadu for permission to start a new self-financing private Engineering College without involving any financial commitment on the part of the Government. As a matter of policy, the Government in their G.O. Ms. No. 429, Education, Science and Technology Department, dated 17-4-1984 had permitted private managements to start new Engineering Colleges under the self-financing scheme without any financial commitment to the Government subject to the fulfilment of certain conditions. Pursuant to the policy decision, the Government granted permission to the writ petitioner to start a private Engineering College in the name and style of Adhiyaman College of Engineering, Hosur, Dharmapuri District, by G. O. Ms. No. 865, Education, Department, dated 9-6-1987. The permission was to start the College with effect from 1987-88. The permission was granted to offer three degree courses with the intake of 180 students per year (60 students in each course) in the following subjects :

(a) Mechanical Engineering.

(b) Electronics and Communication Engineering.

(c) Computer Science and Engineering.

One of the conditions imposed by the Government was that the petitioner could admit candidates of its choice up to 50% of the approved intake of the college under management quota and the remaining 50% of the seats shall be allotted by the Director of Technical Education from among the approved list of candidates selected for admission to Government and Government aided Engineering Colleges. Apart from that, several other conditions were imposed and it is not necessary to set out the same herein. The Government stipulated that if the conditions were not fulfilled by the petitioner, the permission granted was liable to be withdrawn at any time and the Government will have the right to take over the Engineering College at any time with all its immovable and movable properties including endowment and cash balance without paying any compensation.

3. Based on the permission granted by the Government, the petitioner applied to the University for affiliation of the College to the University on 18-6-1987. After inspection of the College through a commission, the University granted by its letter dated 21-11-1987 temporary affiliation to the petitioner's college for the three courses referred to already from the academic year 1987-88 for a period of one year only subject to the fulfilment of the conditions set out in the letter. As many as 27 conditions were imposed by the University. It was made clear in the said letter that an application for affiliation for the Second Year B. C. Degree Courses should be made immediately for the academic year 1988-89. The petitioner was also informed by the same letter that an application for continuance of First Year B. E. Degree Course for the academic year 1988-89 should be forwarded to the University urgently and no admissions should be made to the I.B.E. Degree Course for the academic year 1988-89 until permission was granted by the University.

4. The College started functioning from July 1987. The Inspection Commission appointed by the University before the actual grant of tempor