The Doctor is finally caught by the Time Lords. He and his companions Jamie and Zoe attempt to make a final escape before they are stopped by the Time Lords. Jamie and Zoe are sent back to their respective time periods with their only memories of the Doctor being their first adventures with him.
The Doctor of course has to meet his punishment. His intereference during his adventures in time and space has the Time Lords changing his appearance, being exiled to Earth, and the secrets of his Tardis taken from him. This is how we left the character most would refer to as the Second Doctor.