There was no point in starting a Fully AC Train between Amritsar and Kathgodam (Base of Nainital). IR could have started a train on this route similar to the JS Exp that runs between Amritsar and Haridwar.
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AC Trains (Sleeper or CC) can run on the following routes with good patronage where AC seats go into WL, especially in Summers (too hot...
more... nowadays):-
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1) Howrah - Amritsar via Dhanbad - Sultanpur - Saharanpur
2) Sealdah - Katra via Patna - Sultanpur - Saharanpur
3) Kolkata - Kalka via Patna - Rae Bareli - Saharanpur
4) Jammu - Dehradun
5) Jammu - Kathgodam
6) Jammu - Kalka