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The verdict of the Supreme Court is final till it is repealed by the Supreme Court in another petition. So the state has to accept it but file an appeal petition for the consideration of the full bench soon with a plea for an interim stay for the division bench order. 

Why is it necessary for the Kerala government to file an appeal against the verdict? What is wrong with the verdict ? 
This is the age of democracy and the governments represent the majority view of the citizens who are bound by the constitution of India. It is categorically stated that all citizens are equal before law and no citizen can claim any better treatment before the court of law also. This was not the case in earlier forms of government when the members of the aristocracy enjoyed many privileges that the subjects of the rulers could not think of. In other words, all are not equal before law. 

Coming to the status of the governments, we know they are the voices of the people and not the other way. When India became independent, it was a Herculian task for the Nehru Government to bring all provinces under the India Federation especially the provinces ruled by some kings like the King of Travancore or the Nizam of Hyderabad etc. Only because of the iron hand of leaders like Vallabhai  Patel, it became possible. The recalcitrant chieftains were forced to sign the treaty by accepting some incentives and privileges offered by the Govt of India for their welfare indefinitely. So they started enjoying privileges and financial gains that cost the exchequer a huge amount for the subsistence of the families of the erstwhile rulers in India. 

Unlike in countries where regal system paved way for democracy, India’s former rulers and their family members belonged to a caste by themselves, the Kshathriya who enjoyed and exercised their clout and might in running many states where the democratically elected rulers were weak or slavish to the clout of the aristocratic class. Finally Mrs. Indira Gandhi, with the mandate of the youth in India clipped the wings of the former rulers by withdrawing the privy purse- the huge pension , the details of which were kept a secret from the public legally. Perhaps that was a bold step that put an end to the regal legacy of the hereditary ruling class in India. 
Many switched over to political parties, especially in North India. But in Kerala, due to the progressive activities of the Kerala society initiated by Sree Narayana Guru which was adopted not only by different communities but also by the entire civil society despite their different allegiances, didn’t provide any space to the royal family as found in other states. 
Naturally what the civic society of Kerala who are to a great extent progressive and secular who constitute the major chunk of the left voters expect the present LDF government led by Pinarayi Vijayan to endorse their views rather than abide by  the petitioners who are the royal family members. It is important to remember that the Hon. Kerala High Court had earlier given a judgement granting the ownership right of the Padmanabha Swamy Temple after a prolonged legal battle to the government of Kerala. The government already initiated many steps often not hurting the sentiments of the believers of  Padmanabha including the members of the Travancore royal family to manage the administration of the temple under the court’s supervision.  

Only a few years ago, the hidden treasure stored in vaults underneath the temple filled with precious articles in gold , diamond, pearls, crowns etc. that worth millions and millions of currency enough to feed the state for decades were located and news regarding the wealth of the temple suddenly made it a sensational case attracting international attention. Naturally it is argued that, after considering many legal options, the  royal family which ceased to possess any special privilege after the treaty of unification with Indian Union cannot claim any ownership as the transfer of power to the new republic entails all other ownership also including the ownership of the temple. So the government of Kerala is the legal heir of the temple and its estate according to the rules applicable to the states in the federal set up of the country.  

So no government of the people can afford to allow the  inherited wealth of the state to go to  its previous custodians who in the past became custodians only  by virtue of their authority as the rulers and not as a family holding the temple as their private property. Since it is connected with the huge treasure, when it comes to the interest of the public, any responsible government has to abide by the interest and welfare of its people and not of a family. Whatever be the merits of the Hon. Supreme Court judgement, the government has to accept it , so too the public , but to seek redress is the normal course of action since prima facie the judgement favours the petition of the royal family regarding the ownership of the temple. 
Let us hope that the progressive Left Democratic Front government of Kerala immediately will approach the Hon Supreme Court for a Full Bench Verdict in order to protect the interest of the state and the ordinary believers of the deity who do not form part of the royal family